Message from the Third Ward
Alderman Pat Dowell’s Vote on the Tax Increment Financing (TIF) Sweep Ordinance
At the Wednesday, November 13, 2013, City Council meeting, Third Ward Alderman Pat Dowell voted against the motion to table consideration of the TIF Sweep Ordinance. The motion failed by a vote of 36-11. Had the motion passed, Alderman Dowell was prepared to oppose the ordinance in its current form, which would have eliminated the possibility of using TIF money for needed development in the Third Ward. She made the following remarks on the floor of the City Council:
Thank you Mr. President and members of the Council.
Today I rise in opposition to the TIF Sweep Ordinance.
Some may ask why I am now voting against an ordinance that I co-sponsored.
I joined many other sponsors of this ordinance to put pressure on the Emanuel Administration to declare a TIF surplus to mitigate looming Chicago Public Schools budget cuts.
Shortly after this ordinance was introduced, the Administration did declare a TIF surplus. The TIF surplus has resulted in 25 million dollars in additional funding for the Chicago Public Schools.
The only way to view the Administration's TIF surplus is as a victory by the ordinance's sponsors.
Rather than declare victory and move on to other issues, the ordinance's chief sponsors have decided to double down and have asked this body to pass this ordinance.
As an alderman of a developing ward in desperate need of new investment - I cannot vote for this ordinance. My ward has met and continues to meet the eligibility criteria for a TIF district. This point cannot be disputed. The people of my ward are looking for new retail and commercial development. They demand better streets, sidewalks, and lighting. They have directed me to create living wage jobs in the community for residents of the community.
In a time of constrained budgets and a halting economic recovery - TIF is the primary tool that allows me to deliver the quality of life that the people of my ward elected me to provide. I have used TIF revenues to support new restaurants and other commercial space, provide small business development grants and home improvement grants, to make capital improvements to our schools and parks, to promote housing opportunities, and to improve our ward's infrastructure.
This ordinance would, in effect, strip me of a critical tool to improve and revitalize my ward and remove the blighting elements that the enabling TIF legislation was designed to address.
For those reasons, I vote no.
Senior Holiday Food Drive
Third Ward resident and founder of Stay in School, School is Cool Harold Hall is working with Legends South and Alderman Dowell's office to collect non-perishable food items for a Senior Citizen Holiday Food Drive. From now until December 15th, you can drop off canned and boxed non-perishable food at Alderman Pat Dowell's Ward Office (5046 S. State) Monday through Wednesday from 9am-5pm, Thursdays from 12pm-8pm, and Fridays from 9am-1pm. You can also drop off at Savoy Square (4448 S. State) on Thursdays between 3-5pm and on Fridays between 10am-12pm.
IIT Presents Chicago Police and Fire Departments Scholarship Program
ROSENWALD COURTS APARTMENTS APPROVED BY CITY OF CHICAGO FINANCE COMMITTEE
The long awaited rehabilitation of the historic Rosenwald Building located at 4600 South Michigan Avenue in the 3rd Ward moved closer to reality with the passage of an ordinance authorizing the use of $25 million in tax increment financing (TIF) funds and $58.6 million in loans at the Finance Committee meeting of October 11, 2013.
The Rosenwald, which is on the National Register of Historic Places, was built in 1929 by Julius Rosenwald, then President of Sears, to develop housing for working class African American families at the urging of Booker T. Washington. The building has been vacant for more than 12 years and will soon be renovated with 239 apartments, 51,000 square feet of retail and office space and 27,000 square feet of community space. There will also be a two acre courtyard. Of the 239 affordable apartments, 120 will be set aside for independent seniors and 119 apartments for working families. All of the senior units will be one-bedroom and the family apartments will be one and two bedrooms. It is anticipated that 60 of the 120 senior apartments will be funded by the Chicago Housing Authority which will consider the request in November.
3rd Ward Alderman Pat Dowell commissioned an Urban Land Institute Community Assistance Panel in March 2010 to help her think through development options for the building. With input from community residents and the support of real estate experts, options for redevelopment or demolition of the building were explored.
"I was unwilling to let the Rosenwald sit vacant another 12 years or add an empty city block to our current inventory of almost 3,000 vacant lots in the ward, said Alderman Dowell. The complete rehabilitation of the building with affordable housing, retail and office space was the most economically feasible option and I am thankful that the Finance Committee supported my request for the use of TIF dollars which is appropriate in this case and meets city policy."
The total project cost is $109 million. The total cost for the residential units is $84.4 million ($353,000/per unit), for the retail/ office/community space is $15.5 million, for the two acre park is $1.5 million and $7.6 million in donated land costs. The per unit cost reflects the fact that the decades old landmark building requires a gut rehabilitation including the installation of 6 new elevators, and plumbing, electrical and heating, ventilation and air conditioning systems. In addition, each unit will be finished with a washer and dryer and complete appliance package including a refrigerator, microwave, and stove. Finally, the newly rehabbed Rosenwald will include 3 separate security controlled entrances, dedicated parking for residents, 3 separate community rooms, a computer and education center, storage units, and a vibrant garden courtyard.?
Financing includes tax credit equity of $50.1 million; $25 million in TIF funds; $17.4 million of CHA funds; $7.6 million of seller financing; $5 million of Neighborhood Stabilization Program funds; and a Department of Commerce and Economic Opportunity energy grant of $900,000. $58.6 million of tax exempt bonds will bridge the other financing during construction.
"This investment is good for the Bronzeville community, said Alderman Dowell. The new Rosenwald will complement other planned community improvements such as Shops and Lofts and the Bronzeville Artist Lofts and reactivate 47th Street. In addition, the development will provide 360 construction jobs and 40 permanent jobs, new affordable housing opportunities, new retail and office space, property and sale taxes, and most importantly eliminate an eyesore which has been a drag on the community for over a decade."
The developers are Landwhite Development, LLC out of Indiana, Lighten-Gale Group out of Chicago and Jim Bergman from Iowa. Phase I of the construction will be done by a joint venture of Burling Builders and Tishman Construction. Phase II of the construction will be done by a joint venture of Powers and Sons Construction, Brown Momen, and Sollitt Construction.
Rosenwald Frequently Ask Question (FAQs)
What is the Rosenwald?
The Rosenwald is a National Historic Landmark. The building opened in 1929 with 450 rental apartments. It has been vacant for 12 years and will soon be renovated as a rental building with 235 apartments, a landscaped 2-acre courtyard and a full range of programs and amenities for its residents.
How was Landwhite Developers LLC (“Landwhite”) chosen for this project?
The Rosenwald is privately owned. The City of Chicago does not have any ownership in the existing building. Therefore, there was not a formal RFP process for the Rosenwald’s redevelopment. There have been several plans over the years from several different developers, but none were able to move forward, either because there was not a market for what they wanted to do or because the projects were not financially feasible. Landwhite, however, was able to secure site control with the Seller, and presented numerous plans for a financially feasible project to the Alderman and the City.
Where can one find information on the recent accomplishments of Landwhite?
Landwhite is not the sole owner of this development. Landwhite is one of three very experienced companies that have formed a joint venture (Rosenwald Courts Apartments LP) to complete this transaction. Landwhite has extensive experience with Low Income Housing Tax Credit and historic projects and retail deals throughout the country. Principal Jay Landesman either directly or indirectly has acted as the developer / owner of a substantial number of retail centers in the past 30 years. Mr. Landesman currently participates in ownership of 15 retail centers with 2,400,000 square feet. David L. Roos has managed the development process for 17 LIHTC projects in 5 states. Landwhite specializes in historic renovations and is involved in the development of three other historic renovations.
Jim Bergman has developed more than 35 LIHTC projects since 1991, including most recently Crown Hill Estates, an $80 million dollar, three-phase development providing a total of 335, 1700 square foot single family homes in Gulfport, MS, including the development of the entire infrastructure for the 150-acre subdivision. Other recent family projects include 90 units in Waukee, IA, 72 units in Keokuk, IA, and 68 units in East Dundee, IL. Mr. Bergman has also recently developed independent elderly projects in Fox Lake, IL, Waukee, IA , Bettendorf, IA, East Moline, IL, and in East Dundee, IL totaling 494 units and 90 million of total development dollars. Mr. Bergman also participated in the historic renovation of the Roosevelt School in Decatur, IL. Mr. Bergman’s Low Income Housing Tax Credit portfolio is comprised of more than 2200 units, developed between 1991 and present.
Lighten-Gale Group (LGG) provides development services and coordinates the financing for non-profit, for-profit and governmental real estate developers/ owners. They have been the financial consultants on more than 60 affordable housing projects. LGG has extensive experience with mixed-finance family and senior LIHTC projects throughout Illinois. Recent projects where they have served as financial consultant include Diamond Senior Apartments of Oswego, a 60-unit independent senior project in Oswego, Illinois, Country Club Hills Wellness Center, a 77-unit project in Country Club Hills, Illinois, and MLK Apartments, a 45-unit family project in Chicago.
What direct input did the broader community and closer proximity residents have into the current plans?
There was a formal ULI Panel put together in 2010 that closely resembles the current plan for the Rosenwald. The Alderman has also held multiple town hall meetings, as well as established a Task Force for the current Rosenwald plan.
How many units will there be in the Rosenwald?
There are currently 138 senior units and 97 family units for a total of 235 units. Approximately 75,000 square feet of space has been set aside for retail, office, and community service uses.
When the Rosenwald is completed what is the full capacity (total number of people) for the 235 units?
Based on an average of the maximum number of people who can live in a unit, it is anticipated that approximately 470 people will live in the Rosenwald Apartments when fully occupied.
How much of the building in terms of number of units and percentage will be open to low income tenants and market rate tenants?
The current plan is to have 138 senior units that are compromised of 60 CHA units, 60 rent-assisted units and 18 affordable units. The family side will have 97 units of which 84 (87%) will be affordable and 13 (13%) units will be market rate.
Is any part of the building going to be a CHA building?
No, the Rosenwald Courts will not be a CHA building. The building will include 60 senior CHA units and 60 rent-assisted units out of the 138 senior units.
Are there rent subsidies (section 8/9 vouchers or any such subsidies) being provided to tenants in the building?
The only subsides that are being provided are to the 60 CHA senior units and 60 rent-assisted on the senior side of the building.
What will the rents be for the Rosenwald?
The rent will vary by unit type and size. The 1-bedroom rents range from $450 - $800 and the 2-bedroom rents range from $450 - $850.
There is a perception that the Rent and Tenant income levels will be locked in for 30 years. Is this true?
The building will remain “affordable” for the 30-year compliance period. This means that the income limitations will remain in place for 30 years. Rents can increase, but cannot exceed the maximum rent for the 60% AMI level, which are adjusted each year for inflation and cost of living. In 2012, the maximum monthly rent for a one-bedroom unit is $853, maximum rent for a two-bedroom is $1,024 and maximum rent for a three-bedroom is $1,171.
What does 60% AMI mean?
AMI stands for Area Median Income and is the statistical method used to generate data about geographic areas. It is calculated by dividing households into two equal segments with the first half of households earning less than the median household income and the other half earning more. The median income is considered by many statisticians to be a better indicator than the average household income, as it is not dramatically affected by unusually high or low values. 60% AMI refers to households at 60% of the Area Median Income. Households with incomes up to the 60% AMI limit will be eligible to live in the LIHTC units at the Rosenwald. The building will also have 13 units that are unrestricted, meaning the can be rented to households at income levels above 60% AMI.
Is the 60% AMI requirement fixed for the 30 years? In other words, can it be adjusted downward at anytime for any reason on some or part of the low-income non-CHA family units?
The 60% AMI requirement will be in place for the entire 30 years. The rent can be adjusted upward/downward as the market bears, up to the 60% AMI limit for the restricted units.
At any point can the developer allow subsidies for the family units?
Rosenwald Courts will not include any project-based subsidy on the family side of the building during the compliance period.
Will tenants be required to have jobs?
Tenants will be required to work 30-hours a week, or to be actively looking for employment or in school for 30-hours a week. This requirement does not apply to seniors 62 and older and disabled residents.
Will there be drug testing conducted on perspective tenants?
Who will manage the building?
Mercy Housing Management Group will manage the building, with a potential local joint venture partner.
What is the overall cost for the Rosenwald development?
The construction hard cost for the building is approximately $62,500,000. The total project budget including soft costs, reserves, acquisition price, and contingency is approximately $110,000,000. These costs are expected to decrease when a general contractor is chosen and the plans can be value-engineered for the most savings.
What are the funding sources for the project?
The current funding sources are tax-exempt bonds, historic tax credits, low-income housing tax credits, Illinois Affordable Housing Tax Credits, TIF, NSP funds, DCEO funds, private equity, a construction loan, and a permanent loan.
Besides the Rosenwald, what other improvements are slated for the area?
The Rosenwald will be a major catalyst for development of the 47th Street corridor area, attracting other businesses to the area.
Other area improvements include:
• CPS capital investment in Beethoven Elementary and DuSable High schools.
• CPS investment in educational enrichment currently being planned for both schools.
• Park District capital investment in the Taylor Park fieldhouse, ball field, and swimming pool. There is room for growth in the number of children served by Taylor Park and we are working to make this better known in the community.
• The Hall Branch Library continues to be a center for excellent books, special programs and computer access. The Children's Librarian is one of the best in the city.
• DHED and QCDC are pursing a Special Service Area for the 47th Street commercial corridor to increase attention to security, cleanliness and marketing.
• Bronzeville Artists Lofts on 47th Street will feature a major African American art gallery, a cafe and new housing for artists.
• Lofts and Shops at 47th and Cottage Grove (Walmart) will also spur other investment along 47th Street and Cottage Grove.
• A rehabbed building at 4800 S. Calumet (NSP Project) will stabilize a formally foreclosed property.
• Revival of the city-approved Parade of Homes slated for the 4700 block of Calumet (pending improved market conditions).
• Institutions such as the Urban League, area churches and the Charles Hayes Center continue to provide services to people in need.
• We are also competing for a Choice Neighborhoods Implementation Grant (federal funds), which, if awarded, would bring significant resources in housing, services, and for other purposes to the ward.
Where will the seniors who live in the Rosenwald shop?
While the 3rd Ward works aggressively to bring a full service grocery store to the Bronzeville part of the ward, mobile seniors will have access to quality food products at the proposed Walmart, the Save A Lot at 47th and Cottage Grove and the Walmart at 47th and Bishop slated to open this year. Bus shuttles to area grocery stores will also be planned as has been done at other senior facilities in the ward. We will also pursue a grocery delivery service for seniors and other residents who may be less mobile or prefer to shop in this way.
Is crime a problem on 47th Street posing a danger for our seniors?
Overall crime is down in the ward and on 47th Street. We are working with area police to prevent loitering.
The redevelopment of the Rosenwald is part of an overall strategy to attract businesses to the area, to restore to useful life a historically important building. The re-population of the Rosenwald by seniors and working residents will add vitality to the community and make new retail and other amenities more likely.
Red Line South Job Opportunities
Construction Job Opportunities
CTA will work with the selected Red Line South general contractor and its subcontractors to hire tradespeople and apprentices in carpentry, electrical, ironwork, laborers, operators, plumbers and other areas.
In addition to the DBE goal, CTA will work with the general contractor to hire Disadvantaged Workers. Individuals must qualify via guidelines under the Workforce Investment Act (WIA) as "Disadvantaged Workers," which typically includes, but is not limited to, those who meet income specific guidelines and who've been laid-off, terminated or self-employed. Interested individuals will be encouraged to visit a one-stop WIA Workforce Center.
Individuals who qualify will be screened and trained, if needed, by Dawson Technical Institute, a division of Kennedy-King College. Following their training, potential apprentices will be eligible to be hired by the contractor on the project.
For more information about the Disadvantaged Worker Program or your eligibility, please visit the Mid-South Workforce Center (MSWC), 4314 S. Cottage Grove, Chicago, Illinois. Contact MSWC at 773-538-5627 (TTY: 773-538-8260).
Learn more about workforce centers by clicking here.
New Bus Driver Positions
As part of CTA's operations' needs, 150-200 new bus operator positions will be created to help serve our customers' needs during the five-month construction period, specifically to operate bus shuttles. These jobs are permanent and will replace positions that become available over time, even after the construction project is over.
It's a great time to join the CTA team! For more information about these and other employment opportunities at CTA, follow the directions on their Careers page to see job postings.
Alderman Dowell’s Votes on the Speed Camera and Infrastructure Trust Ordinances
At the two most recent City Council meetings, I cast votes on two ordinances that will affect all residents of the city. I cast a no vote for the ordinance authorizing placement of speed cameras near schools and parks and voted in favor of the Chicago Infrastructure Trust ordinance. (See ordinance here.)
Last week, I cast a no vote against the speed camera ordinance (see ordinance here.) because it fails to do what it proposes in a cost effective manner. The placement of the cameras is solely based on the data quoted to City Council members and that data does not necessarily indicate a specific need for the cameras.
Under the camera ordinance, input from myself or constituents will not be used in determining the placement of the cameras. In other words if residents near a park or school know that speeding occurs on a routine basis, there is no mechanism to include that information when determining camera placement. Reducing the speed around parks and schools can be achieved just as effectively by the strategic placement of stop signs, speed bumps and other traffic calming strategies, which could also be done at a much lower cost. For these reasons I voted against the speed cameras.
On Tuesday, I voted in favor of the ordinance authorizing the Chicago Infrastructure Trust. This aggressive plan to invest in our obsolete infrastructure is not a privatization plan as some have called it. When it was first proposed I raised several issues concerning aldermanic oversight, the lack of conflict of interest rules, provisions for open meetings and freedom of information inquiries, and a requirement that transactions performed by the trust meet the city's minority- and women-owned business requirements. I outlined these and other reservations in a Chicago Tribune column I wrote earlier this month with my colleague Alderman Ameya Pawar, 47th Ward. (See Tribune Op-Ed. article here.) I am happy to say that voicing our concerns had an impact that led to revisions and negotiations.
Mayor Emanuel agreed to changes in the ordinance, which put an alderman on the Infrastructure Trust Board and guaranteed a City Council vote on all projects involving city money, assets or property. He also inserted a provision requiring trust-funded projects to follow city bidding procedures and another barring board members with a financial interest in a deal from voting on it. The Mayor also said he would issue executive orders requiring outside review of trust deals and finances. (See executive order here.)
Our neighborhoods have crumbling roads, dilapidated viaducts, and hundreds of miles of decaying water mains that are more than a century old. We must do something, but we don't have the money and city residents don't want to pay higher property taxes. The Trust is needed and will draw investment to Chicago. It also has the potential to jump start our economy and put thousands of people back to work. For these reasons and the future of our city, I voted in favor of the Chicago Infrastructure Trust ordinance.