Please welcome to the stage, Axios Chicago reporter, Justin Kaufman.
Welcome.
Welcome to spring, everybody.
Yeah.
Thanks for coming.
I'm Justin Kaufman from Axios Chicago.
I hope you're all subscribers to the newsletter.
I appreciate you being here.
Obviously, we like to do events at night.
Breakfast is good, too.
And we're excited to have such a great crowd and such a great lineup of guests tonight or today.
See, I'm already in my mode of tonight's breakfast events are are new to me.
I'm excited for all the guests that we have lined up.
It's going to be a great program this morning.
Thanks for coming out in this weather.
Hopefully this is the last snow of the year.
Everyone here from Chicago knows that March or April we get one.
That's it.
And we're out.
OK, so let's get into this.
This is a part of our series called Zoom In.
This is the second one that we're doing here for Axios.
Very exciting.
We did one in D.C., and it's really this kind of awesome collaboration and discussion about what's the future of our communities,
what's the future of cities, what's the future of towns, states, counties, everything across America.
And Axios and the great partners are going city to city to talk about this with stakeholders and city leaders and things of that nature.
So we're very excited to have you here today, and we're going to have this conversation.
Before we get to that, I want to say a big thanks to JPMorgan Chase and the U.S. Conference of Mayors for helping us bring this to life.
There's a live stream.
Those who are tuning into the live stream, hello.
You can follow along with the hashtag Axios Events.
All right.
Before we get started, I'd like to welcome to the stage for some brief remarks the head of government, health care, higher education, and not-for-profit at JPMorgan Chase Commercial Banking, Curtis Reed, Jr.
Give it up for Curtis.
All right, all right. Good morning, everybody. Welcome on this snowy, cold Chicago morning.
I'm extremely excited to be here. Again, my name is Curtis Reed. I run our government healthcare
higher ed not-for-profit business, and I'm extremely excited to help kick off this conversation
with Axios on how we can expand affordable housing in Chicago. So Chicago is not just
where I work, it is my home. I've been here for half a century. It's also the home of JPMorgan Chase,
founded in 1863 through our predecessor firm First Chicago,
famously by Abe Lincoln's law firm. It was the eighth national charter. I think it's still the
oldest charter around. Another fun fact, Abe Lincoln opened his first checking account,
one of our predecessor firms, Springfield Marine, $310 back in 1853.
But, of course, we don't measure our commitment and success by years alone.
We know that we are part of the fabric of this community.
It's not just providing products and services to Chicago and our clients.
It's about how do we collaborate with our residents, community leaders, business leaders,
and really understanding what are the key challenges and opportunities in Chicago
that we can leverage our expertise and resources to create the biggest impact in Chicago.
It was two decades ago that JPMorgan Chase bought Bank One.
Our CEO, Jamie Dimon, made a steadfast commitment to Chicago
that we are going to remain here in Chicago and not only be here in Chicago,
but continue to invest even more.
I'm proud to say, as we sit here today, 15,000 employees,
One of the largest employers in the state of Illinois, 4 million consumer customers,
400,000 business customers, 270 branches.
We've also, since 2017, have made upwards of $200 million in philanthropic commitments
to disinvested communities, mainly in the south and west sides.
I'm also proud to say we launched our $30 billion racial equity commitment right here
in Chicago to continue to support additional housing, $600 million we committed, additional
housing mainly for those in the south and west sides here in Chicago.
But we know as much progress has been made, there's way more to do.
And so we look forward to this conversation today with Axios, we look forward to
working together with Axios and the U.S. Conference of Mayors
to find out what are some of the models that have been done in other cities
that we can replicate here in Chicago.
Today we're going to hear from local leaders,
my own friend and colleague, Michelle Herrick,
who runs our commercial real estate banking,
talking about how we can continue to create economic vitality here in Chicago
and continue to expand affordable housing as well.
So without further ado, I want to announce our next speakers, Justin Krause with Axios Chicago, and the Honorable Jonathan Jackson, representative of the 1st Congressional District, member of the House of Foreign Affairs, and Agricultural Committees.
Thank you very much, and I look forward to the conversation.
Thanks, Curtis. Give it up for Curtis.
Welcoming back to the stage, Justin Kaufman.
All right. Let's get this conversation started, shall we? We ready?
All right. Ladies and gentlemen, I'd like to introduce our first guest to be talking with the congressman from the 1st District of Illinois, Jonathan Jackson.
Congressman. All right. All right. So let's get right into it.
Are we let's talk about Chicago. We talk about the country as well.
But are we in an affordable housing crisis? Absolutely.
Affordable housing used to be defined as having spent more than 30 percent of your income.
Now we see people are spending better than 40% of their income, which means they have less money to have, A, a recovery fund,
if you're temporarily unemployed and you get behind on a month of rent, or if you need to pay for lessons, dental, hearing, health care.
So it's a true crisis.
At a certain time, you say 40%. I think it's higher than that for a lot of us here in Chicago.
But, I mean, in the 1st District, there are a lot of problems in the 1st District that have been surrounding housing generationally in Chicago.
You know, when you start talking about like people spending 30, 40 percent of their of their income on rents or mortgage, it's exacerbated.
It's more in communities that are in your in your district, more situations where it's untenable.
They cannot actually afford it.
Well, there's also the compounding effect where you also have the transportation issue where we have less access to mass transit.
transit is the key link between welfare and work people's ability to get to work oftentimes say
whatever Martin Luther King did it's just not fight for Mrs. Parks to have a seat it was bigger
than that he was a minister he was fighting for public transportation here we have Chicago Transit
Authority that goes to Evanston Illinois the Chicago Transit Authority goes to Forest Park
Illinois but the Chicago Transit Authority does not cover all of the city of Chicago that was by
design so if you look at segregation and mass transportation that's a double whammy so it's
not just you are where you live it's where you have access to transportation to and from
i taught the community colleges in chicago and inglewood it's very much a food and health and
other kind of things that are being denied them and opportunities and also shot at chicago state
and when i look at the mass transit lines but i also went to northwestern university
So I know what mass transit lines can do to help move people in and out of a community and have access to health care, food, and other amenities.
We're in a situation where we'll stick on transportation for a second, the long-awaited expansion of the Red Line South.
You know, these are projects that we've talked about in the city of Chicago for years.
And finally, the money comes along, and a new administration says maybe not so fast, no money.
How do, from the federal level, from your seat on the Hill, how do you make sure that these issues are taken care of and not at the whim of a political agenda or a change in administration?
Well, we've had change of administration.
What's so unusual and so abnormal now is this is not a normal administration.
This administration is breaking the law, willfully gutting things.
I serve on the House Foreign Affairs Committee, USAID.
I will never say I'm starving again.
We've all used that term lightly, but I will say that I want some food. I don't even try to say
that I'm hungry because once you've seen people with starvation in their eyes in the parts of
the Sudan and parts of Kenya, once you've seen those persons in Haiti and the like, you don't
say you're starving. When you see bloated bellies, bugs on eyes and people that actually need the
food. And when you see the USAID packages with the United States flag on it, with our name on it,
and we're passing out food, malaria, HIV vaccinations,
and to know that food is in a cage right now,
the medicine is spoiling, people are starving,
people are dying today as we speak.
That's cruel.
What's happening now in the United States and Washington...
As President Trump gets ready to dismantle the Department of Education today, you're going to starve it.
And this isn't like a car where you can turn the key in the engine and take it out and restart it.
Once these persons have lost their jobs with their very unique skills that have committed themselves to public service,
in 30 days, 60 days, they have to move on to continue to find a new job.
You can't rebuild that institution.
I'm almost writing this off as the lost decade because of what he's doing in the first 60 days of this administration.
He got in there on January 20th, it's March 20th, and he's running us into a recession and making us extremely isolated.
I think, you know, when you think about Congress right now, you know, when we talk about bringing it back to affordable housing,
is there a will in Congress to address this problem?
Is there an understanding, both sides of the aisle, bipartisan, to say, listen, you know, 30 percent, it used to be 30 percent, now it's 50 percent.
People are hurting in every state, every community.
It's not just a Chicago issue.
Is there a will?
Is there a desire?
Is there any sort of motivation for Congress to do something to help people?
No, not at all.
So I was out with Congresswoman.
Thank you very much, everybody.
I was out with Congresswoman Justin, Congresswoman Maxine Waters.
She's the ranking member on the financial services.
We had a demonstration outside of the CFPB for the Consumer Financial Protection Board.
And we, as members of Congress, cannot go into the agency that she has oversight on.
We went to HUD to try to deliver a letter to the director of HUD.
We were turned back and stopped by police from entering into the HUD office building.
So we're not able to even talk with many of the directors or secretaries.
And let me digress one moment.
Even with Mr. Pete Higgs of the Department of Defense, I don't know how many people saw it,
But they said they had even taken down the reference to Jackie Robinson being black and other things.
Mr. Pete Hegseth, the director, the secretary of defense, is breaking the law.
If he reads the law, I know he has a proclivity to want to find bars.
But if he decides to find a library, yes, I said it and I meant it.
But if he has the interest to find the library and read the statutes,
what it said is in the Students for Fair Admissions that you could not use affirmative action in the Harvard case,
It's found at 1636.
You couldn't use it in the University of North Carolina.
It's found at 1789, the oldest public and private institution.
But it did say, because the amicus brief was written by the military, that you can use it in the military academies.
Affirmative action is legal in the United States military academies.
So I feel very strongly about that.
Both of my grandparents fought in World War II, and so I don't want to see this young post-weekend anchor Fox guy try to interpret U.S. law.
He's discriminating and he's race baiting and it's wrong.
Yeah, okay.
I'll get back to housing here.
I think at the end of the day, I mean, we could go through,
it does feel like right now we can go through topic after topic after topic
and talk about how it's rapidly changing in Washington.
But, you know, one of the things that this reminds me of is a connection to your family,
as your father, Reverend Jesse Jackson, was part of the Chicago Freedom Movement in 1966,
which Martin Luther King came to Chicago.
He set up shop in Lawndale to essentially raise awareness about unfair housing in Chicago, open housing.
This is similar in the sense as we flash forward to 2025.
Do we need another Chicago Freedom Movement?
Does there need to be more activity, civil rights activity, when we're talking about the right that is housing?
Absolutely. The freedom movement and the open housing push has a particular affinity for me.
I'm Jonathan Luther Jackson. My father had Reverend Martin Luther King make me his godson
at Billings Hospital. Well, then it was Holy Cross, first African-American baby born in that
neighborhood. But the freedom movement started January 7th, 1966, on my birthday. So I felt as
if I was born for this. And no, yes, we absolutely do need it. That what are we talking about
affordable housing? That we're talking about people's access to decency for people to have
a sense of shelter, people to have a sense of protection. And what does the neighborhood look
like is what the nation has to define. It can't continue to sprawl out into the suburbs. Some
places in Europe, they have impact fees the further you go out. How do you make cities
affordable? What we're seeing now in many of these urban areas, there's a glut of commercial
properties here in the city of Chicago? How do we repurpose these buildings, bring people in,
let young people start their lives without this onerous debt of school and inaccessibility to
their credit?
So how do you revitalize this? Young people need a fresh start, so there has to be a big deal.
And I think it starts with housing, transportation, and employment.
And it's not just, you know, a move for open housing really had to do with segregation at the time
and what was available for black Chicagoans as opposed to white Chicagoans.
In this case, it's similar in the way that we're seeing a lot of class struggle,
where a lot of people who used to consider themselves to be middle class are now priced out of neighborhoods.
They're not able to, and you find yourself the border going west or south or north gets you, you're absolutely right, outside of city limits.
The city is doing things about that, but if you talk about the first district, I mean, there's always these plans of land trusts or dealing with abandoned properties
or trying to bring back public housing, you know, through CHA or through HUD.
What are some of the things that you think Chicago should be doing, the state of Illinois, or the country should be doing to try to invest in housing?
Well, first of all, there's a lot of regulatory burden that should be addressed on some of the housing.
Sometimes there are cast iron pipes that are used in one neighborhood that people are using polyvinyl chloride in another.
So there's some materials that can bring down some of the costs.
When the properties are abandoned, the city makes no revenue.
So a way to speed up the transfer of those deeds to single family, multifamily housing,
where investors can also put property back on the product.
on the market, the cost of housing is going up.
So I think that's a twofold question
that you have to answer.
One of which is being able to have affordable housing.
The second part is, is being able to afford your housing.
So it's not gonna get cheaper to have housing
with the current tariffs that are coming in.
If you look at aluminum and gas that we get
in the Chicago region from Canada,
we're gonna get hit with another $5,000 bill
just on our rising aluminum costs
and our rise in the specific gas that we need
that comes from Canada that goes into our refineries.
Our gas does not come from the Gulf of Mexico.
And then you can recycle some of that property.
But government needs to make some sort of assistance.
We had talked a little bit earlier about the COVID issue.
That's what my definition of good government is.
The government helps people when they cannot help themselves.
One of the things you can argue is whether or not the government gave too much money during COVID assistance.
But it took all the pain and the lumps out.
we were able to weather a storm. Now things are improving, things are rebounding until this man
has started driving things into this recession period because people are losing confidence,
people aren't spending as much money. But government stepped in. The government should
step back out once people are able to recover. People are going to need some rent assistance
because the cost of housing is too high, which imperils them from getting to affordable work
with gas costs, with the cost of eggs, and other things that you may need.
Okay, so we've got a big lineup today, and we've got some folks coming up next, too, including the mayor.
My last question for you off-topic, you threw your hat in to be the chair of the DNC,
the Democratic National Committee.
It didn't work out, but where are the Democrats at right now?
Because the polling is down.
You know, there's questions about how to resist this administration from your vantage point
of wanting to run the Democratic National Committee.
What needs to be done in 45 seconds?
Big issues.
I was at the inauguration on January 20th, January 27th, along with my colleague, Congressman
Cleo Fields.
We created the Congressional Diversity, Equity and Inclusion Caucus.
These are aspirational values.
President Donald Trump, if we concede that lane, we've conceded too much.
You can't take e pluribus unum out of the American lexicon and our language.
That's an aspirational value.
Frederick Douglass would talk about a composite nation.
And when we talk about equity, talking about the 14th Amendment, we talk about inclusiveness,
people having access to handicapped ramps and people that are differently able.
We're talking about creating human potential to make sure we get the best out.
He's closed the door on that.
That's where women got to play sports.
That's where African-Americans got fair housing.
That's where we've seen major improvement with Hispanics.
We've got to open that door, and the Democratic Party cannot be timid about it.
If we need to have a conversation about race and relations
and what's equitable and what's historical and what's going forward,
we shouldn't be cowardice in saying, no, that's black.
I'm black. I've been black my whole life. I'm not afraid of it.
I thank God that he made me this way, and I'm not going to have people close the door,
desecrate my my grandfather's graveyard talking about you can't talk about Jackie Robinson he's
just even put this new repeal on uplifting Johnson's 1964 Civil Rights Act against prohibiting
segregated facilities enough is enough and speak candid to people I think this generation wants to
go forward we're not going back we should say it
Congressman John Jackson, Congressman, thank you. That was great. Give it up. Congressman of the First District here in Illinois, which includes Chicago. All right. It's my pleasure to introduce our next guest. He is the publisher and my boss. I like him, which is great. Ladies and gentlemen, Axios is Nick Johnson. Nick.
Good morning, everyone. I'm Lickinless Johnson, the publisher of Axios.
Thanks so much for joining us this morning, I guess, on a beautiful first day of spring in Chicago, playing very much to type here.
We're very grateful for all of you coming out to join us, especially those of you who are subscribing to the awesome Axios Chicago newsletter.
If you're not a subscriber, please sign up. It's one of our best.
So we're grateful for your support. We're also hugely grateful to the support of all of our partners at Axios.
Nothing that we do, none of our investments in journalism would be possible without the support of our partners.
So we're hugely grateful for J.P. Morgan Chase, which has been a partner of us from the very beginning
and is helping support these conversations, not just in Chicago, but around the world, around the country.
Not the world yet. I'm upselling a little bit here.
Around the country. We started in Washington where Chicago will be in other countries for the rest of the year to talk about solutions for cities.
We're very grateful for their support, their partnership with the U.S. Conference of Mayors, which is another great partner of ours.
And so I'm very excited to welcome four of you from the top conversation, the head of commercial real estate for JPMorgan Chase Commercial Banking, Michelle Herrick.
Michelle, welcome to the Axios stage.
I am great.
Thanks for being here.
Thanks for having me.
Let's start big picture.
Tell us a little bit about your role and how it relates to what JPMorgan Chase does in communities.
Sure, of course.
So I am the head of commercial real estate for the commercial bank at JPMorgan Chase.
we support developers owner operate owners operators of real estate across
the country we are the largest lender to the industry and the banking sector and
with that comes a depth of knowledge a depth of product and a very real
commitment to our local communities real estate when it is as but when it's its
best is creating assets that are adding to the vibrancy of towns for very very
long periods of time and so we take our responsibility in this quite seriously
what as I mentioned that in 2024 we're quite proud that we did over six
billion of debt and equity adding to the supply new supply and the preservation
of affordable housing over 45,000 total units how that translates into our local
Chicago community over the last few years we've done over 2 billion around
18,000 units. As Curtis mentioned earlier, our JPMorgan commitment to Chicago is real. I live
here. And so I'm very proud that we've been here for 160 years. We support a lot of different
industries, vital institutions in the billions every year. And it's very fun to play such a role
in seeing my local community thrive. Yeah. So you mentioned some of the funding in affordable
housing unit creation i feel like from your vantage point you have a very good view of the
broader state of things so from your seat like tell us the state of affordable housing in chicago
chicago uh you know i would say we are not unique and that this is a very tough challenge for a lot
of communities to solve but if you think about we have over three million consumers that we're
supporting here over 350,000 local businesses we have 15,000 of our own
employees here and we see the gap that is in continuing to increase between the
existing supply of affordable housing and the demand for those units and by
local estimates Chicago needs a little bit over a hundred thousand additional
units what's happening of course buildings depreciate they go obsolete
They become, as they get older, they get more expensive to maintain, and we also need to keep building more.
And so Chicago does need more units, and we are committed to that.
How does that compare to the national viewpoint?
Chicago better?
Chicago worse?
Chicago average?
As I mentioned, Chicago is not unique.
By our estimates, there's three to four million.
It is unique, but not in this issue.
Sorry about that.
Tough crowd, all right.
It is in the same company, similar company.
The United States could use somewhere between three to four million of additional units.
So that is why, yeah, go ahead.
I was going to say, that's why from our seat, it is so vital to be supporting federal, state, local policies.
This is a solution that takes everyone coming together, and so continuing to invest and encourage and support the activation of various land sites for additional supply, smart construction costs, decreased regulatory burden, developer incentives at some level to tackle this problem altogether.
You mentioned everyone coming together, which makes me want to ask about, like, public-private partnerships.
Like, how does, like, we have government officials here, you from a large bank.
Like, where do these things come together to solve for these problems?
Two-part.
They have to come together, and I think we come together across the country, but especially locally here, quite often,
because it's necessary to solve this problem and because we're Midwesterners and everyone likes working together.
would say it at basic math if from my seat if you ask a developer to build a
building and we say let's limit the income ability on the on the project but
it's same cost or additional cost it leaves a funding gap and so the way that
you solve that gap is is everybody coming together and smart public policy
and nonprofit support and we do this regularly again to the six billion that
I referenced for our 2024, a local example of this that we're particularly proud of.
We are involved in the North Sheffield Apartments, which J.P. Morgan contributed $120 million
of debt and equity for the creation of a little bit over 400 units of senior housing.
It's a mixed-use project where we were able to add market rate resident units,
additionally affordable units and what had traditionally been a higher income
area we love being solution oriented at these can you dig in more a little bit
on strategies that work what are lessons folks in this room can take away if you
like this is how we should be thinking about because there's a lot of more that
needs to be built yeah yeah I look I think it's it's a challenging problem
in a very creative industry that involves a lot of different groups of
people so I think it's all ideas on the table and everybody working together to
tackle this problem it is it is essential to communities being able to
thrive you want to be able to live locally to where you work where you go
to school where your family is and and so again it's what we've talked a little
bit about but activating land usage helping to get through a regulatory
process a little bit quicker or smarter or more efficiently with that decreasing
some of the cost or burden associated with getting through that process I
think essential is activating local community engagement very early in the
process around all of this of course we each care deeply about what is being
constructed what is being added making sure it is added is additive to our
local community and so I would say and activating land trying to decrease
construction costs through creative solutioning decreasing regulatory
Tory Borden, working together in public-private partnership and always, always remembering
that this is a local business where community engagement is table stakes.
Where it's not just one person or one group deciding.
It's kind of this convening factor here where you need the bank, you need the federal government,
you need the local government, you need the communities, all of these parts involved to
solve it.
It's community.
Right.
Everybody's got to be together.
Yeah.
Well, we're about to get the hook here.
I love to end on one fun thing, like we end all of our newsletters.
And so for those of us who are maybe out of town, who are going to the airport shortly, like me,
give me one good Chicago thing to do on a nice, beautiful day before I leave.
You are in my favorite season of Chicago, which is looking out the window every morning and wondering,
is it spring, winter, or summer?
So I would say, look, my favorite part of this town is our lakefront.
and the activation of our waters and the river walk and the lakefront.
So if you're brave, head out here and take a walk.
And if you're less brave, go upstairs and stare at it and think about how nice it is here.
I've got a pair of dress shoes.
I'll go take a look at the lake, I guess.
Michelle, thank you so much for being here.
Thank you for having me.
Thank you very much.
The conversation continues with Monica from Axios Chicago.
Please give it up for Axios Chicago reporter, Monica Ng.
All right, now for the moment everyone's been waiting for.
Thank you so much for coming on this gorgeous spring day.
Without further ado, I'd like to introduce the Honorable Mayor Brandon Johnson.
All right, so let's get this party started.
Well, first, I'd like to note that we could talk about housing and housing issues for two hours.
We're going to focus this one right on affordable housing.
You know, the unhoused issue is a huge one.
But on affordable housing, as we've heard, we're short about 120,000 units.
What are the biggest opportunities and challenges for meeting that challenge and shrinking that number down?
Well, thank you for that question, and good morning to everyone.
Let me just say this.
Right now, the city of Chicago, we are conservatively sitting at about 2.7 million, almost 208 million people.
We can get, believe it or not, about another 400,000 people in the city of Chicago.
I know it doesn't feel like that when you're driving, particularly trying to get somewhere in the morning.
Rush hour.
Right, but we do have room, and that is my top priority, is to repopulate the city of Chicago with working people.
So two of the things that I'm very excited about is that we put forth a $1.25 billion bond investment for economic development, workforce development, half of which will go to that.
The other half will go to building more affordable housing.
That's how committed I am to this effort.
It's the largest investment in the history of Chicago, so we're taking this seriously.
The second thing that we're doing, and we heard from your last panelist,
is that we are eliminating the barriers that have stalled or have impeded the ability for us to build affordable homes.
The red tape in government is not just arduous, it is painful, and it costs us time and money.
We have found, conservatively, 100 opportunities where we can expedite the process.
As a result of that, since 2023, since I've been in office, almost 4,000 affordable units that we have built, 1,800 are under construction, 4,600 in the pipeline now within the next 18 months.
So I'm moving with some expediency.
You can, hopefully you can sense the urgency here because affordability in this city, really across this country, as we have this challenge with not enough units, that really is the human rights issue of today.
And so these are the things that I'm excited about.
these are the opportunities that we are creating and this is why i'm encouraging everybody to move
to the greatest frequent city in the world the city of chicago i hear you um so on that point
there's the cut the red tape initiative can you talk to me a bit about you know exactly what that
entails yeah thank you for that question i'll go a little bit deeper into this so there are
processes and procedures that have been unnecessarily arduous and it has cost developers
and homeowners or rental people who would like to rent
and have affordable rental units
or just doing development as a whole,
it has caused so much consternation
and developers and banks, they give up on the process.
So we've identified, as I said,
about 100 opportunities to speed processes up,
everything from building permits
to that will actually help us move with some expediency.
We're excited about a brand new project on the southeast side of Chicago, CyQuantum,
which we know that entire campus is going to attract more development.
We're going to need more affordable homes there.
We have expedited that process.
And with the responsibility that government has in this moment,
there are things that I will do through executive order to move the processes from, for instance,
things that have taken nine months, we can bring it down to six months or three months.
We also need support from the city council to be able to pass policy that will allow those opportunities to come into fruition.
But again, we're already seeing the benefit of the Cut the Tape initiative by being able to move many of the projects that I will speak more about,
move those projects through the process a lot faster.
The Tribune recently reported on the fifth city common development in East Garfield Park,
saying that per unit it was about $884,000 to build,
and then they pointed to another one down the street where it was $150,000 per unit.
What were they getting wrong in that analogy in saying it just costs too much to build?
I mean, why?
Well, those homes, these homes were built with LIHTC funds.
And that's low-income housing tax credits from the feds, right?
Very good.
I'm learning.
I've been setting up on housing policy.
But through those LIHTC funds, the encouraging thing is that these units will be affordable,
and we have locked in affordability for the next 30 years.
So that's a good thing.
The unfortunate aspect about the way those funds are earmarked and distributed, as well as the rules and regulations that are attached to those funds, there are other costs to those type of developments.
Lawyers, and God bless lawyers, right?
Syndicators, right?
These individuals and these companies that manage the investment.
There's all these other middle layers that end up adding to the cost.
This is why, and I'm happy to get into this, this is why I'm really excited about not just the Cut the Tape initiative,
but our Green Social Housing initiative and ordinance that we are putting forward before the city council.
Because what we ultimately have to do is find social opportunities at the local level to build affordable housing units.
You know, I was listening to Congressman Jackson as he was describing, essentially, the chaos that exists in Washington, D.C. right now, as well as the uncertainty that exists there.
And I'll be even more direct. The animus from the current administration towards public accommodations.
And that's education. We know what they're preparing to do today, which has impact on our families and their desires to live in our cities, Department of Justice, but also HUD.
And so by having local solutions that do not rely upon the federal government, it allows for that bold and audacious initiative of mine to repopulate, particularly the west and south sides of the city of Chicago, with working people.
It gives us an advantage to do that so we don't have to rely upon the federal funds and all of the layers that come with that that ultimately build the cost out more than usual.
Yeah, I was going to ask you, because I'm intrigued by this Green Social Housing Initiative.
It seems to, yeah, it says we're not going to go for the oversubscribed LIHTC funds.
We're going to create our own sort of funding mechanism here.
Can you tell me a bit more about that?
So the way I understand it, and boy, have I been trying to bone up on housing policy
that I did not understand.
We create, if the City Council passes it, and that might be this month, next month?
The expectation is for the City Council is to support this effort in April.
So if the City Council passes it, we're going to create an independent body
that can do the financing for these developments
and work with private developers
but keep a majority stake in the buildings once they're done.
And then once they're filled, then they can refinance
and then work on another project with that same money, right?
So as a former social studies teacher,
Do you know how proud I am that you did your homework?
Oh, my goodness.
I didn't do it when I was at CPS.
That's impressive.
Well, let me just say that I'm really excited about the Green Social Housing
Ordinance that we're putting forward.
It would be a $135 million fund to create this revolving loan
so that we can continue to build more affordable units.
It would be the largest investment in the country.
I just want to make it emphatically clear that in the city of Chicago, there's only one way in which we know how to do things. We do it big. And this is critical because the lifeblood of our communities have to remain in the hands of working people.
The challenge that we have in our society right now is that all of our policies favor private equity and banks, big-time investors.
And look, we know it takes all of us to participate in building an economy that works for everyone.
We're just saying that we have to have an equitable distribution in order to ensure that working people's priorities are secure.
Because let's just be honest here. When it comes to the capitalistic society that we're all assigned to, the bottom line becomes the focus.
And we're saying that we don't have to put profit over people. We could center a fund.
that is publicly controlled and builds permanent affordable housing.
Okay, I'm going to sit up because this is where I get really excited.
Is that creating this structure that the public would essentially own and dictate and control.
I forgot to mention one-third would be permanently affordable, the rest market rate that helps subsidize that.
Exactly. So now this subsidy is being maintained by the individuals who are in a stronger economic state to help sustain working people.
That is the type of shared interest that this does, as well as, again, it reduces our reliance upon the fickleness and sometimes the stinginess that comes from the federal government.
Now, look, here's why we're excited. We know in Montgomery County that they have moved in this direction.
That's outside D.C.?
Right, just outside of D.C. And as the lifeblood and as the soul of America, the Midwest inner city of Chicago,
Creating this revolving fund, making sure that public has dictation and access and leadership, while making sure that there is a permanent, sustainable cost savings, not just fund, but space for working people.
That is how not only do we build, this is how we also rely upon our local innovation and ingenuity,
and this is how we also make sure that the public space remains front and center,
because if we just simply rely upon the market to dictate and determine affordable housing,
well, you see what we're experiencing right now.
It just doesn't work.
I'll sit back now.
So that's the social part of it.
Tell me about the green part.
Why was it important?
And the Montgomery County part is definitely like that.
But we added green. Why?
Yeah. So, look, the green economy is the economy of the future. Right.
Not under this administration in D.C.
You're absolutely right to call out this administration and its inability to recognize truth for whatever reason.
It's just this administration can't figure out truth nor humanity.
But the evolution of our democracy cannot be disrupted because of one person.
And the reason why we're focusing in on green is because, again, our economy is naturally moving towards more energy efficient,
cost saving measures that protect working people and we create jobs as a result of it.
And so I can tell you, and I hate to bring this up again because it is kind of old news,
But there were people who were making a big deal about my family because we were on a payment plan for our water bill.
And there were folks in the mass space that were trying to make a mockery out of the fact that affording utilities in Chicago or anywhere else, that is a working person, poor person's challenge.
It's a challenge that I've had my entire life.
I know what it's like to have my orange extension cord from our window to our neighbor's window
just to make sure that the fan or the refrigerator was still working.
And so our green focus is about reducing the utility costs, reducing our carbon imprint on our planet,
as well as creating an economic engine that allows for working people to experience the new economy through the green economy, through green technology.
So it does three things.
Protects our planet, creates jobs, and it makes sure that people don't lose their homes because they can't afford their electric bill or their gas bill.
So the investment on the front end will be saving money and saving carbon emissions on the other end,
and hopefully the federal credits for that will remain in place.
I can't let you go without asking, are we going to get a CTU labor contract today?
Who's asking that? No one's even talking about that.
No, no one's holding an afternoon press conference.
Let me just say, you know, as a former public school teacher,
I know exactly what our teachers need and what they're going through,
especially our elementary teachers, needing that preparation time so that as students come back into their classrooms, that everybody's refreshed.
I know that there are concerted efforts to make sure that our veteran teachers that are typically overwhelmingly black, brown, women, women of color.
that their pay is able to keep up with the cost of living.
There are elements around how we evaluate educators
to make sure that we're giving them the tools that they need to be most effective.
What I'm laying out is that there's not a big space
between where we started in this contract negotiations
and where we're ultimately needing to land.
And so, you know, look, I will close with this.
I'm the first mayor in the history of Chicago to support an elected representative school board and actually stick to it.
I'm the only mayor in the history of Chicago that believes in public education so much that I actually send my own children to our public schools in Chicago.
That's how important it is to me.
Settling this contract puts us on a path to not just a more equitable, just system, but then it allows us to turn our attention towards where the real enemy is.
And the enemy are those who do not believe in public education.
W.E.B. Du Bois said that public education at the expense of the state, particularly in the South, after all, is a Negro idea.
The idea of public education and public accommodations is the hope and aspirations of descendants of slaves.
As the mayor of the city of Chicago, I owe it to our ancestry to ensure that our public education reflects our values in Chicago.
And then we have to make sure that we fight like everything that's in us to ensure that the federal government doesn't turn its back on working people.
On that note, thank you very much, Mr. Mayor.
Please welcome to the stage Axios Chicago reporter, Carrie Shepard.
Yeah, I know.
Community philanthropic organization that's been around Chicago for more than a century.
The CEO and president, Andrea Saenz.
Thank you.
Oh, should I do that all again?
Did no one hear that?
Okay.
Andrea, thank you.
Welcome.
Thank you for being with us.
And I don't think to this audience we probably have to explain who the Chicago Community Trust is.
It's a very well-known foundation.
But the trust has been focused particularly in the last few years,
especially on the wealth gap in Chicago and around Cook County.
Explain the connection between home ownership and access to wealth.
Good question.
Hi, everybody.
I think most of you know if you're at this event because you care about housing,
that homes and the equity that you can build over time in your home is the single biggest contributor to family wealth across the United States.
That is particularly true in communities of color who tend to have less access to a more diversified portfolio of wealth building tools and strategies like retirement funds and investment funds and things like that.
So, you know, for us, we have been really focused on figuring out how to increase wealth in communities of color in Chicago as a way to create stability, to create opportunities for those families to have access to resources to invest in their own future, to weather a storm, to plan, to start a business if that's what they aspire to do.
So when we looked at all of the ways that we might play some role in helping those families build the wealth that would allow them to have well-being in the long term and pass it on to the next generation, homeownership became an obvious area of focus.
The issues, though, and I know we're going to get into them a bit, that we see today
are, you know, in 1968, when the Fair Housing Act passed, the rates of homeownership in
this country for black Americans were pretty close to what they still are today.
So although there have been many attempts at addressing these issues, we realized we
We need fresh eyes, fresh energy, fresh ideas brought to bear if we're really going to make a difference here in Chicago.
Stay there, those systemic barriers, right?
It's maybe not, it's kind of a modern day redlining, right?
But what are some of those barriers that keeps that black homeownership down?
So there's a bit of a vicious cycle issue, right? So if you don't have assets, hard to get a loan.
If you don't have the kind of income that allows you to put money away on top of your expenses,
hard to save up for a down payment. If you don't have wealth in your family that you can access
for down payment help from your parents, you know, siblings, et cetera, hard to pull that together.
So there's still essentially an income and sort of access to capital gap that is both a cause of and the effect of the persistent wealth gap in our communities.
So that's one of the things. Secondly, we still see bias and study after study shows us in lending.
So the terms for loans that people of color get are often inferior to that for which they qualify compared to their white counterparts, and that continues to be true.
We've seen bias in home appraisals in communities of color that also contribute to folks having less access to capital.
For example, so if your home is appraised at a lower value than you need it to be, you can't necessarily take out a loan to do home improvement that allows you then to sell it for a higher value.
So it becomes these many, many vicious cycles that keep many families from being able to become homeowners in the first place.
And then I think those barriers persist when you are a homeowner and your property taxes continue to increase.
But the value of your home doesn't necessarily keep pace with the increases across the markets.
And so it just, you know, it sort of compounds as investments compound.
So does lack of capital. The gap in those in those returns compounds.
Yeah. And we'll talk about some of the ways groups like the trust are trying to, you know, combat some of those issues, especially like the appraisal process.
But there's a stark number that you all identified.
It's the net median wealth of black families versus white families.
Dig into that.
Yeah, so income is studied, and there's publicly available data for understanding income by race and ethnicity and by different kinds of groups.
We found that it was difficult and not really available to understand the wealth, the assets that homes have across our county.
And so we teamed up with a research team that had conducted a study in five other cities called The Color of Wealth.
And they, through survey methodology and other means, helped us understand the true disparity in wealth and household assets across the region.
And, you know, to those of us who work in this field, it was not a surprising set of numbers, but they're still sober.
So a white family, the median wealth for a white family in Chicago is about $210,000.
The median wealth for a Latine family is somewhere between $6,000 and about $40,000,
depending on their kind of country of origin, place of birth, those kinds of differences in demographic groups.
And for a black family in Chicago, it is at this moment zero,
which means that their debt outstrips their assets and you know not totally
different from the national picture because we've seen national studies that
come close to that but still incredibly sobering and I think worse than what
we've seen in other cities where this study has been conducted not surprising
we understand the legacy of segregation that we're still living with in this
city we still see the life expectancy gap that is about 30 years from the west side to the loop
so sobering not surprising we still have a lot of work to do yeah let's talk about some of the
solutions you know just listening we were listening backstage to congressman jackson
talking about his father legendary father obviously and the chicago freedom movement
and sort of this need for activism and what do we really need to do to confront the problems in
affordable housing. And you talk about the appraisal and all these products that are not
available to certain families. So what are groups like the trust doing to combat some of those
issues? So I would say they're sort of a multi-pronged approach. One, it does start with
policy advocacy. And I know we're going to talk about what's happening with HUD and other things.
And it really is so important and critical that we all play a role in advocating for the policies
and the resources, the public resources that our communities need.
So that's one area of work.
But in terms of just trying to come up with new and different
and comprehensive solutions to the issues.
We're engaged in a variety, and one I'll highlight is called 3C. It is one that is supported also by JPMorgan Chase, and I'm not just saying that because their logo was behind here a minute ago, and Polk Brothers Foundation along with the trust, and it's part of a national model called 3C, Connecting Capital with Community, or Connecting Capital and Community, but 3C generally.
And what they're doing is, as I said, it's a comprehensive look at the issues, the underlying issues.
So one is helping developers build affordable units that are for purchase.
Right now, the pilot is taking place in Garfield Park and Humboldt Park.
They've acquired, through partnership with public entities, parcels of vacant land and vacant lots.
They're working to help developers then build on those lots in a way that is keeping the cost low enough so that they can sell them for affordable prices.
At the same time, they're working through community housing counseling organizations and other such organizations to help people in those neighborhoods become ready to become homeowners.
So that means credit fixing, that means counseling, you know, financial counseling, that means helping them access down payment assistance products and programs that are often government subsidized but are available through CDFIs and other kinds of community-based lenders, and helping all of that come together in a way.
The third piece, you know, that we've talked about is the income, lower incomes in these communities make it difficult to access,
especially right now with high interest rates, commercial mortgage products.
So they're also experimenting with and testing a very low interest, a 3.5% 30-year loan product that they're introducing in these communities with these families.
So all of those pieces kind of coming together is what we think it takes.
How do you entice developers, though, to develop in West Garfield Park versus these fast, gentrifying neighborhoods, Logan Square, Avondale, et cetera?
What brings them there, what draws them there?
What we found and what I've seen, and, you know, I haven't been sort of deeply involved with the developers themselves,
but what I've seen when I've had an opportunity to engage with them is that they have a sense of responsibility to the community, right?
Many of these people are communities, are developers of color.
They are people who they themselves have maybe experienced the kind of barriers that the folks in the neighborhoods are experiencing,
and they are trying to make their business work for them in a way that also works for their community.
And there are, fortunately for us in Chicago, many such community-minded, socially-minded real estate developers.
I think that's nice to hear because I think sometimes we don't hear that side of it.
You know, we were talking backstage to your colleague, Nina, and she grew up in Pilsen and, you know, her grandmother's block is like new development, new development, new development, you know, and then we see the and there's so much great housing stock and everything that we're losing when we knock those places down.
Is there any version of these programs, policies, products like the mortgage and products you all are talking about, but that are are there cities that are doing it right?
That's a really good question.
we have been connected with colleagues at other community foundations across the
country and they're all tackling this issue differently I would say what what
we all have in common is that there's always a public-private relationship
that allows for things to move and so I think you know every city is different
the conditions are different the housing stock is different you know in Chicago
we do have a lot of vacant property in Chicago. We do have an affordability like possibility
that places like San Francisco lost many, many years ago. We've been working with folks in
Atlanta who are trying to reimagine how they create both lending products and grant products
that together allow for the building of affordable housing across the city at scale. You know, what
What we what we haven't seen yet is the scale actually happened.
There's promise of scale. Yeah. But as we've been talking about all morning, what we really need are, you know, thousands and thousands of affordable units, not a handful.
And we're still at the piloting stage. Right. And Chicago is unique in so many ways and great.
But, you know, as in most large cities, it's segregated and the housing represents that and the access to housing represents that.
are you um we've heard a little bit about the trump administration from congressman jackson
are you concerned are organizations like yours concerned about any sort of change in federal
funding that might happen with the new administration yes uh to be clear the federal
funding that was available for the kinds of innovative solutions that we need was already
inadequate and now with recent news about cuts to HUD programs both those
programs that allow for there to be monitors of the Fair Housing Act and so
even you know in Chicago there are organizations that have already lost
tens of millions of dollars of funding to do their job just in the last two
months okay as monitors of fair housing practices right and then there are the
subsidies, the federal subsidies that developers rely on that are also being cut. And this is just
two months in. So are we concerned? Yes. What's the recourse? Oh, what is the recourse? So yeah,
great question. So a couple things come to mind. One, you know, because federal policy was already
not meeting the need and meeting the day.
There has been this focus on local solutions,
and I think that's the right place for us to focus
for the next several years anyway, right?
Both local and state solutions to these issues.
Second, the recourse is advocacy.
I mean, there's really no other way
is to not give up on these things.
Just because they've been taken
doesn't mean they can't come back.
And the only way they'll come back is if we exercise our, you know, civic duty
and push for things that we know our communities need.
That's a nice way to end the call to action.
Thank you, Andrea, from Chicago Community Trust.
And thank you to everyone for joining us today.
If you are not already subscribed to Axios Chicago, please do.
You can go to axios.com slash Chicago, I think.
But thank you all for joining us today.
This is fantastic.
Thank you.
Thank you.