CategoryEconomics

Inclusionary zoning calculator will tell you how many units a developer can afford to make “affordable”

An “inclusionary zoning” calculator can help you determine how much affordable housing your town should require that developers build in their new construction residential buildings.

I learned about Grounded Solutions Network’s Inclusionary Housing Calculator at the second-ever YIMBYtown conference in Oakland, California, two weeks ago.

YIMBY (yes in my back yard) is a movement to reduce barriers to building more housing in order to be able to house everyone at a level they can afford. It’s a movement for other things, and it means a lot of different things to a lot of different people but the end result is that more housing needs to be built.

An interested person inputs a lot of values relevant to their local housing market into the IHC and it will calculate the cost of construction per unit and the rental income from those units, and then will figure the profit margin for the developer. What makes this “inclusionary” is that one also needs to enter the desired portion of units that are set aside as “affordable” (to people making a certain income) and subsidized by the developer’s rental income.

I put the IHC through a real world exercise by inputting as much data as I knew about a rejected proposal in Pilsen.

The first proposal from Property Markets Group had 500 units, and 16 percent of them were set aside (news on this and their subsequent proposals). Chicago’s Affordable Requirements Ordinance, or ARO, requires that 10 percent of the units are affordable, and that 25 percent of those 10 percent must be built on site. The other 75 percent can be built on site, or the developer can pay an in-lieu fee per unit.

Needless to say, 16 percent on-site is much, much higher than 25 percent of 10 percent. A neighborhood organization, the Pilsen Land Use Committee, however, requires 21 percent in the area, and the city council member, Danny Solis, 25th Ward, adheres to.

PMG said they couldn’t go that high, and that’s what I wanted to test.

According to this Inclusionary Housing Calculator, could the developer make enough profit (considered as 10 percent) if the building had 21 percent of units as affordable?

In this exercise, the answer was “no, PMG could not make a profit if they had to set aside 21 percent of the units as affordable.”

But the calculator showed that they could earn a 12 percent profit if 16 percent of the units were affordable. 

Some of the inputs are actual, like the sale price of the land (found in the Illinois Department of Revenue’s transactions database), but I had to make up some inputs, including the apartments’ bedroom mix, and the future rental prices of those apartments.

Further reading

  • It’s tough for people to move into one of these set-aside apartments in Chicago (DNAinfo Chicago, July 28, 2017)
  • Inclusionary zoning cannot create enough affordable units (City Observatory, February 11, 2016)
  • Other housing cost calculators like this one (City Observatory, July 26, 2016)

Links between Emanuel’s campaign donors and their building projects

The Tribune called out Emanuel’s appearance at a press conference as an endorsement of a locally-designed skyscraper (Studio Gang and bKL Architecture) to be built by Wanda, a Chinese development company – it has yet to receive any approval. Photo: Ted Cox, DNAinfo.

The Chicago Tribune reviewed the campaign contributions of Mayor Rahm Emanuel’s top donors and linked each donor to how it does business with Emanuel or the city. The article overall discussed how easy it is for Rahm to raise more money than what’s probably necessary to be elected a second time.

The Tribune graciously provided this data as a simple table which I’ve republished here in order to add links to building permit information from Chicago Cityscape. The website I’ve developed lists company and person names in an immediately searchable form. Currently there are over 90,000 companies, architects, and property owners that have received a building permit since 2010. Use the Illinois Sunshine database to find out who’s contributing to whom in the Chicago election.

Note: You’ll see “listed under [many] names” for several companies; this indicates that the Chicago building permit database uses different spellings, or the company has changed their name.

[table id=1 /]

Neither the article nor this table are meant to indicate any wrongdoing – campaign donations are public and it’s common to receive them from companies that do business in Chicago. It’s the extent that the donation appears to pay for favors or favoritism over other donors (which may be competing companies), or what’s right, that determines when immorality becomes an issue (a connection that’s hard to demonstrate).

Building permits for new and changed things in 2014 is going up

New City 19-story residential tower under construction near Lincoln Park.

The building permits data that powers Licensed Chicago Contractors has 11 permit types and I analyzed five of them to show the “new stuff” activity in Chicago this year through May 26, 2014. “New stuff” is the economic indicator to show that things are getting built. It includes the permits issued for new construction, renovation and alteration, porches, easy permit process (which can include things like kitchen renovation, or a new garage), and electric wiring where the estimated project cost is greater than $1.

You can see there was a small dip between January and February but since then has been climbing. See How’s Business? for more business-based metrics of the Chicago economy.

After publishing this chart I decided I’ll include signs because that is part of the “new stuff” activity I am trying to visualize. The other five permits are for scaffolding (a job indicator but not a “new stuff” indicator), elevator equipment (these aren’t always about new or replacement projects), wrecking and demolition (these permits usually don’t include estimated costs), and permits that represent extensions and reinstatements.

Finding interesting data in the building permits dataset

I had several great conversations with fellow #chihacknight visitors at the 1871 tech hub (222 W Merchandise Mart Plaza) about how to reveal more information about what’s being built in Chicago. I had introduced Licensed Chicago Contractors at the previous week’s hack night and tonight I showed site changes I made like how much faster it is now that I use DataTables’s server-side processing function.

Some of the discussions resulted in suggestions to try new tools and methods that would make processing the data more efficient, or more revealing. What are the ways I can aggregate the data, or connect to similar data from other sources?

One of the new features I announced I’ll be adding is statistics on building activity by neighborhood. I started testing some queries to see the results, and to find the query that outputs that information in a way that’ll pique users’ interests.

I calculated the aggregate estimated costs of all building permit activity for the past 90 days in select neighborhoods. All of the data was automatically generated using a simple MySQL query, but one that will get faster after switching to Postgres. (I eliminated any project whose estimated cost was less than $1,000 because there are many project types that are $0 to several hundred dollars.)

  • Logan Square: 77 projects, totaling $16,295,997.50 at a $211,636.33 average cost
  • West Loop: 30 projects, totaling $27,646,899.00 at a $921,563.30 average cost
  • Andersonville: 6 projects, totaling $358,770.00 at a $59,795.00 average cost
  • Bronzeville: 34 projects, totaling $17,050,662.00 at a $501,490.06 average cost
  • Hyde Park: 20 projects, totaling $13,492,265.00 at a $674,613.25 average cost
  • Humboldt Park: 35 projects, totaling $41,917,988.00 at a $1,197,656.80 average cost

How does Humboldt Park double the other neighborhoods’ average? I think it’s pretty simple: this $40 million Salvation Army residence that’s going to be built at 825 N Christiana Avenue.

The results for Bronzeville were higher than I expected because this is a distressed neighborhood that has lost of lot of population and has seen little development in the past several years. This isn’t to say the neighborhood is poor – I saw a report last fall that highlighted how the purchasing power of Bronzeville residents was quite high relative to neighboring communities.

Ronnie Harris showed me the report when I participated in the Center for Neighborhood Technology’s civic app competition and hackathon. We, along with Josh Engel, designed Build It! Bronzeville, although my participation was really pushing them to develop Josh’s game idea more and construct a paper version of it. Our team won the competition and Ronnie and Josh have kept working on it (I saw them at last week’s hack night).

Projects that pushed up Bronzeville’s average included several multi-family homes at around $1.4 million each on the blocks of 4700 and 4800 S Calumet Avenue.

Code discussion

I can’t test for the “Loop” right now in the way I have my data structured because a LIKE ‘%loop%’ query of the database will include “West Loop” records.

I need to change how the building permit data is stored – in my database – a little so that my site’s PHP codebase and MySQL queries can sift through the data faster. For example, I’m storing several key-value pairs as a JSON-encoded string in a TEXT field. One #chihacknight developer suggested I switch from MySQL to PostgreSQL because Postgres has native JSON-parsing functions.

I looked up how to use Postgres’s JSON functions and realized that, yes, I probably should do that, but that I also need to change the array structure of the data I’m encoding to JSON. In other words, with a tiny change now, I can be better prepared for the eventual migration to Postgres.

A new freeway depreciates itself and the city as fast as your new car

A Metra train bypasses congested automobile traffic on the free-to-use Kennedy Expressway. 

Elly Blue wrote about automobile depreciation last week. Depreciation is the value of the automobile that disappears because it’s not as valuable anymore, for reasons of mechanical decay and the “used” factor.

Depreciation is, for many individual consumers a hidden cost. But any responsible accounting of the costs of driving includes it as one of the largest associated with car ownership. The fact that such a large and unprofitable investment is necessary to living and working in most areas of this country is a major source of poverty and failure to get ahead for people and families, and is a hidden source of poverty on a national scale.

The same exact principle is at work in our road system.

It’s depreciation at the societal level. It’s irresponsible not to plan for it, but we do not. A freeway, once built, immediately begins to deteriorate and become congested, it loses its ability to provide the jobs that often were much of the argument for building it in the first place.

Think about the Circle Interchange project the Illinois Department of Transportation is bent on building. For 10 minutes I monitored the “public forum” room at the late June – and final – public meeting about the project to rebuild and increase capacity at the intersection of I-290, I-90/94, and Congress Parkway. I heard seven people speak and at least five of them focused their two minute speeches on the “good jobs” that this project would provide. These are the same “good jobs” that $470 million spent on any other transportation project would generate, like the underfunded but highly beneficial CREATE project that reduces congestion and travel times for freight, Metra, and Amtrak trains in the region.

The Circle Interchange will add an imposing flyover to Greektown and residents and workers on Van Buren Street. 

Building something for jobs is the worst reason to build something. At least with transit (or tollways, for this matter) there is a recurring funding stream, with every use. Oregon is slowly moving in the direction of taxing drivers by mile instead of by gallon, but starting only with electric vehicles. Illinois is issuing bonds for its freeways with the country’s worst credit rating.

Elly’s article had me thinking of other ways cities lose. One of the commenters mentioned there is a loss in property taxes, when properties are demolished to make way for the highway. As Rick Risemberg wrote, “Roads themselves do not pay property tax, of course.” The revenue from those razed properties is eliminated, permanently.

This train flyover represents what the Circle Interchange flyover, over Halsted, will look like. At least this flyover has a revenue stream.

Another way cities lose property tax because of highways is that it makes properties around highways less valuable. It also makes existing, now vacant properties less desirable to developers. So, we have less revenue and then a lowered desire to develop there. Seems like a Catch-22.

However, urban rail stations and bikeways are now known to raise property values and thus government incomes, though this money generated by them is usually not allocated to the infrastructure that created it. (Some places are beginning to use “value capture” mechanisms to do so.)

Risemberg makes sure to point out that gas taxes hardly cover the costs of building highways. I would add that, at least in this state, more and more is being spent on debt service.

And this is all slightly relevant to the article I posted Tuesday on Streetsblog Chicago about transit-oriented development. It’s the third of three articles on the topic based on a report by the Center for Neighborhood Technology that essentially says that Chicagoland, compared to San Francisco, Boston, New York, and Philadelphia, are not experiencing the same benefits of them as adding housing to the transit shed (within 1/2 mile of a train station) and that driving is up in the transit shed of Chicagoland while transportation costs, as a portion of household income, are rising faster in the transit shed than outside. These were surprising to CNT, where the expectation was, in brief, that living near a train station provides more mobility, closer retail and services opportunities, and thus would reduce dependence on expensive automobile ownership.

What modernism should we preserve?

Ed. note: This post is written by Ryan Lakes, friend and architect

Goldberg’s Marina City towers are a couple of my favorite buildings in Chicago, but all of the discussion about preserving Prentice Women’s Hospital – designed by Bertrand Goldberg – has left me conflicted. The following is my response to the video above that was originally posted on Black Spectacles.

When we figure out how to easily move old, significant buildings that are no longer wanted by their owners and occupants, to museum-cities made up of the old masterpieces that have since fallen out of use or favor, then we will have the luxury to preserve them like books, paintings and sculptures. To me, large buildings are more like trees than art. Occasionally the great old fall to make way for the young. There is no moving them. And as time passes, individual systems age and decay, and evolution leads to new, often more efficient ways to compete for space and resources.

Prentice Women’s Hospital is slated for destruction by its owner, Northwestern University. Photo by Jeff Zoline. 

Contemporary architecture has a new set of more complex criteria to respond to than what was included in original modernism’s scope. With form ever following function, in modernism, as functions change, so too shall the forms. Is modern architecture able to do so? How do fans of modernist buildings plan to preserve them as fuel prices rise and the desire for energy efficient buildings increases?  What else besides their structure is not obsolete? Let’s not forget that the time of modernism was when most thought our resources were unlimited, that it was better to leave our lights on 24 hrs a day to save bulbs, and that it was better to employ machines to fabricate our buildings rather than our neighborhood craftsmen.

Photo of Zurich Esposito at protest to save Prentice by David Schalliol. 

Survivor bias: Who walks away from automobile crashes?

This photo of a damaged car has little to do with this post. 

Then my friend Alex E. asked, “Is there a reason why?”

I can’t leave such a question hanging. I thought I read that somewhere, and it was probably in Tom Vanderbilt’s book, Traffic. What I found in there mostly referred to trucks (the semi-trailer type) because of their mass and how people not driving trucks behave around them on the road. The second part explained the statistics around who lives and dies in crashes involving a drunk driver.

Knowing that, and knowing the story I tweeted a link to, you’ll see that the event didn’t involve a truck and my relating them was perhaps unsuitable. It did involve drunk driving, but I may have misread the book text.

Here’s what Traffic says about trucks

“When trucks and cars collide, nearly nine of ten times it’s the truck driver who walks away alive.” Vanderbilt discusses how that is (page 247).

…we all likely have proof of the dangerous nature of trucks. We have seen cars crumpled on the roadside. We’ve heard news stories of truck drivers, wired on stimulants, forced to drive the deregulated trucking industry’s increasingly long shifts. We can easily recall being tailgated or cut off by some crazy trucker.

Just one thing complicates this image of trucks as the biggest hazard on the road today: In most cases, when cars and trucks collide, the car bears the greater share of what are called “contributory factors”.

Really? Car drivers caused crashes with trucks and then die from it?

Instead of relying on drivers’ accounts, he [Daniel Blower at Michigan Transport Research Institute] looked at “unmistakable” physical evidence. “In certain crash types like head-ons, the vehicle that crosses the center much more likely contributed to the crash than the vehicle that didn’t cross the center line”.

After examining more than five thousand fatal truck-car crashes, Blower found that in 70 percent of cases, the driver of the car had the sole contributing responsibility in the crash.

Basically, the car drivers in a car-truck crash caused the crash and ended up being the ones dying.

…the reason trucks are dangerous seems to have more to do with the action sof car drivers combined with the physcial characteristics of trucks and less to do with the actions of truck drivers. “The caricature that we have that the highways are thronged with fatigued, drug-addled truck drivers is, I think, just wrong”, Blower said.

“In a light vehicle, you are correct to be afraid of them, but its not because the drivers are disproportionately aggressive or bad drivers”, Blower said. “It’s because of physics, truck design, the different performance characteristics. You can make a mistake around a Geo Metro and live to tell about it. You make that same mistake around a truck and you could easily be dead.”

What Traffic says about drunk driving

Of the 11,000 drunk-driving fatalities studied by economists Steven D. Levitt and Jack Porter, 72% were the crash-causing drunk driver or their passengers, and 28% were the other drivers (most of whom were not drunk themselves) (page 251).

I wish I wrote a blog about food trucks sometimes: Chicago has made it really difficult for expansion

The Flirty Cupcakes food truck. Photo by Andrew Huff. 

Most of my time (because it’s actually my job) is to blog about transportation. This blog is about cities, and cities are about food trucks, so I guess it’s fine. I neither own a food truck, nor patronize them, but I’m fascinated by the process of how city administrations are handling them, whether through some kind of indifference or making regulations that seem only to make running a food truck more difficult than it should be.

At a “mobile food summit” at the University of Chicago in the spring of 2012, I learned from the sponsor Institute for Justice that they were suing cities for passing unconstitutional laws that regulated business not for health and public safety, their duty, but to protect the economic well-being of other businesses. Based on that knowledge, Chicago did this with the food truck ordinance from July 2012.

The Chicago Tribune reports today, in summary form, the current status of this regulation (here’s the full article):

No city licenses for food trucks

The city hasn’t licensed a single food truck for onboard cooking since the practice was approved in July. Some food truck operators say they’re scared off by the extensive red tape they foresee in the application process. Of the 109 entrepreneurs who have applied for Mobile Food Preparer licenses, none has met the city’s requirements.

I looked this up to know more and I found short commentary on Reason magazine’s blog:

The City of the Big Shoulders is hungry. And 109 entreprising folks want to help feed it. Too bad they’re not allowed to.

For example, the Tribune interviewed proprietors, one of whom said, “While most of its provisions are similar to those in other major cities, [Gabriel] Wiesen said, Chicago’s code includes rules on ventilation and gas line equipment that “are meetable but extremely cumbersome and can raise the price of outfitting a truck by $10,000 to $20,000.”

The bit about the regulation possibly being unconstitutional is that the food trucks with this license (which allows them to cook on the truck) must have a GPS device recording their position during retail hours and cannot operate within 200 feet of a brick-and-mortar restaurant (except in designated mobile food truck loading zones, for a maximum of two hours). Restricting where and when a food preparation business can operate is the tricky part: the city doesn’t regulate this for brick-and-mortar restaurants (except for zoning, which is much more lax and is intended to keep incompatible land uses away from each other).

Tell it, Sue Baker! Car crashes are not accidents

“It was an accident!”, said the driver. Photo by Katherine Hodges. 

Because of Hurricane Sandy, the New York Times paywall is down so I’m reading every article I can, starting with “Safety Lessons from the Morgue“:

As she explains it, “To say that a car crash is an accident is to say it’s a matter of chance, a surprise, but car crashes happen all the time, and the injuries that people sustain in those crashes are usually predictable and preventable.”

Another car crash-related excerpt from the article about Sue Baker, injury prevention researcher extraordinaire:

In one of her recent projects, Baker looked at another aspect of highway deaths. The study, which Baker prepared with David Swedler, a doctoral candidate, examined more than 14,000 fatal crashes involving teenage drivers. They found that male drivers were almost twice as likely as female drivers to have had high levels of alcohol in their blood and were also more likely to have been speeding and driving recklessly. Significantly, 38 percent of 15-year-old drivers, both male and female, were found to have been speeding, but by age 19, female speeders dropped to 22 percent, while male speeders remained steady at 38 percent.

Those differences, Baker says, suggest that boys and girls should not automatically receive the same driver training — and that boys should perhaps receive their license at an older age than girls. “Males might scream foul,” Baker acknowledges, “but let them.”

Yes, let them. It’s too easy to get a driver’s license in this country.  I love her style:

In 1979, at a Department of Transportation public hearing about the dangers faced by truck drivers, Baker angrily explained, “Isn’t it time we did some crash testing with trucks and dummies, rather than with drivers themselves?” Later, according to Baker, the trucking industry hired a researcher to try to discredit her driver-safety studies. Unable to uncover problems with her work, he eventually gave up and called to tell her about his assignment. [emphasis added]

Not everything is perfect with injury prevention studies, though.

In the mid-1970s, [Sam] Peltzman did research on highway fatalities that suggested that mandatory safety features like seat belts and padded dashboards actually encouraged people to drive less cautiously.

Tom Vanderbilt talked about that in “Traffic“, which is basically my favorite transportation book, even mentioning Mr. Peltzman. Flip to page 181 to read it. Vanderbilt lists all of the different labels for that behavior:

  • the Peltzman effect
  • risk homeostasis
  • risk compensation
  • offset hypothesis

He summarizes: “What they are saying, to crudely lump all of them together, is that we change our behavior in response to perceived risk, without even being aware that we are doing so”. But Sue has a response:

Baker acknowledges that there may be some individuals in cars with anti-lock brakes, for example, who may not apply the brakes as soon as they did with the old brakes. But she insists there is no evidence that better brakes or air bags have encouraged recklessness — that they have in fact saved many thousands of lives. “What concerns me,” she says, “is that these spurious arguments are used by companies to bolster their opposition to beneficial safety regulation.

I think it’s safe to say now that she’s a personal hero of mine. But way, there’s just one more thing!

As she talked about what still needed to be done, her voice was tinged with anger: “Buildings need to be designed so it’s not so easy to fall down stairs. All new homes should have sprinklers. Traffic lights should be timed for pedestrians, not to move as many cars as possible through an intersection.

Yep. Exactly what we don’t do. We make ’em wait. And wait. Without even telling people the traffic signal’s even acknowledged their presence.

More

The fixie-hipster index for this bike rack is near 1

Upon leaving the Third Thursdays party at the Chrome store at 1529 N Milwaukee in Wicker Park I spotted a bike with a funny attachment on the stem. After uploading the photo, I inspected it more closely and saw that four fixed gear bikes were locked to a single bike rack.

The fixie-hipster index for this bike rack (for this block, even) is nearing 1! Or 100%. Or 1:1.

But Chicago didn’t even place in the Top 25 Hipster Places in America.

© 2017 Steven Can Plan

Theme by Anders NorénUp ↑