Could Rent Control Come To The Second City?
Jonathan Projansky moved into an apartment building on East 47th Street in Chicago’s Kenwood neighborhood in 2003. He liked that he paid about $550 a month for a one-bedroom apartment.
But not long after Projansky moved in, he said rents began to double at the South Side building.
“It came as quite a shock … Not just that there was a rent increase, but that it was going to be doubled,” Projansky said. “Most folks couldn’t afford that. I had just moved in, and I began to see everything from single folks to working families slowly and steadily moving out of here.”
Like some of his neighbors, he too moved out.
That experience led Projansky to a new cause: rent control. That’s the term for government-mandated limits on how much landlords can increase rents.
Chicago doesn’t have it. No municipality in Illinois has it. Since 1997, Illinois law has forbidden rent control. That means, theoretically, renters could end up paying much more each year at their landlord’s discretion.
But on March 20, voters in 77 precincts distributed through nine Chicago wards will be asked if Illinois should lift that ban on rent control. Mayor Rahm Emanuel’s office said he’s not taking a position on the rent control referendum, but advocates for and against the issue are making a strong push leading up to the vote.
Renting in Chicago
Chicago is a city of mostly renters.
So when Chicagoans hear “rent control,” they tend to think of New York City. Television sitcoms from Friends to Sex And the City have shown characters able to afford living in expensive Manhattan because of rent control.
Yet, rent control is a contentious debate around the country. And methods vary widely. Some cities use a renter’s income, geography, or building age and size to determine the rules around their rent control policy.
Chicago briefly had rent control after World War II because of housing shortages, but withdrew it in the early 1950s. In 1997, the state banned the practice altogether.
But there are no rules like that anymore in Chicago. That might be why, according to the Chicago Rehab Network, an affordable housing advocacy group, half of those tenants are burdened, meaning they pay more than 30 percent of their income toward housing. Almost all low-income families face that rental hardship.
The Institute of Housing Studies at DePaul University found housing displacement in Chicago is on the rise. And for neighborhoods where new investment flourishes, affordability is a challenge.
What’s a referendum?
A referendum is a ballot question, often non-binding. That means even if it gets a majority of the votes the law won’t change.
There are a couple versions of the rent control referendum question on the ballot in various Chicago precincts: Should the state of Illinois lift the ban on rent control to address rising rents, unjust evictions, and gentrification in our community?
Jawanza Malone, with the Lift the Ban Coalition, a network of neighborhood organizations that formed in the summer of 2016 to put the brakes on rising rent costs, helped get the referendum on the ballot.
“This has to be the easiest public campaign I’ve ever been involved in. All we have to do is say, ‘Hi, we’d like to talk to you about rent control,’ and you’re done. People are hurting,” said Malone, who is also executive director of the grassroots Kenwood Oakland Community Organization, known as KOCO.
Projansky worked with Malone to take the referendum campaign to communities on the North, South, and West sides. They got it on the ballot in neighborhoods where people are worried about rising rents: places like Logan Square, Albany Park, Bronzeville, Pilsen, and South Shore.
The referendum is advisory; so even if it passes, the state law won’t change.
First, that law would have to be overturned. And then individual municipalities would have to vote on enacting rent control. But there’s an immediate purpose to the referendum, advocates said.
“We want the results of the referendum to create a mandate for our elected officials,” Malone said.
Not everyone is in favor of rent control
“We’re opposed to it. Rent control is not the answer to the affordable housing program in Chicago. It will create more problems than good,” said Brian Bernardoni of the Illinois Association of Realtors.
Bernardoni predicted developers would start selling their buildings or turn them into condos if rent control went into effect.
“Both of those things would have a massive impact on the tax base, and when the tax base lowers, the tax rate has to go up,” he said. “This is not something to be played with.”
Bernardoni used San Francisco as an example: Housing is notoriously expensive and the city has rent control. He said better recipes for affordable housing are focusing on property tax caps for landlords and giving incentives to developers.
Janet Smith, who studied housing policy for years at the University of Illinois-Chicago and has been advising the Lift the Ban Coalition, said there’s a lot of conflicting research around rent control.
“Economists think rent control limits your mobility. That you feel you’re stuck because you have this rent control apartment,” she said. “Advocates are like, ‘Yes, we want that to happen. We want to reduce the likelihood of displacement, of rents going up so people are forced out of their communities because they can’t afford it.’”
But Smith said after examining the pros and cons, she thinks rent control is a tool that should be explored in Chicago amid growing income disparities.
“You don’t want to put policy in place after the problem happens,” Smith said. “If we look back to when people were talking about rent control in the early 2000s, we were already seeing rapid rising of rents on the North Side when neighborhoods were picking up in places like a Logan Square where everyone’s like, huh, Logan Square. That wasn’t hipsterville then. If it had rent control then, Logan Square might look very different now.”
Smith said rent control could help the future Logan Squares.
A bill to repeal the ban
That’s where Democrat Will Guzzardi comes in. The state representative, whose district includes Logan Square, has a bill that’s seven words long: The rent control pre-emption act is repealed.
“Rapidly increasing rents are forcing families out of their homes. As property values go up and property taxes go up, families who lived in communities a long time get pushed out. Those who are landlords in those communities where property values are rising, they pass along those property tax increases along to their tenants as rent increases,” Guzzardi said.
While that can be a natural cycle of development, Guzzardi said he wants to stop the potential for abuse.
“The landlords who see neighborhoods changing and look at that as an opportunity to take advantage of people by kicking out the existing tenants, jacking up the rents by a whole lot and bringing in new folks into the neighborhood who can afford to pay more. We see that time and time again in Logan Square,” he said.
Guzzardi admits his bill is a long shot — in part because the influential real estate industry is opposed to lifting the statewide ban. The bill is on hold, as he tries to gather allies. He’s determined to get a committee hearing this year
He says a successful lift the ban vote in Chicago would help amplify the drumbeat for change.
Natalie Moore is WBEZ’s South Side reporter. Follow her on Twitter at @natalieymoore.