Samuel Paler-Ponce, MPA
Associate Editor
Loyola University Chicago School of Law, JD 2026

Last week, Chicago City Council committees on Housing and Finance convened for negotiations and discussions on a monumental—and markedly contentious—green social housing plan. This comes nearly two months after Mayor Brandon Johnson and the Chicago Department of Housing introduced an enabling ordinance in the Chicago City Council, allowing the City to establish an independent nonprofit with the authority to serve as the Green Social Housing (GSH) developer. The GSH model tackles both housing insecurity and climate change head-on by developing permanently affordable, energy-efficient homes in every community. Spearheaded by the Chicago Department of Housing and the Illinois Green New Deal coalition, this initiative is poised to reshape how housing is built, owned, and lived in across the city.

Sustainable, affordable housing financing

The Green Social Housing Revolving Loan Fund, seeded with $135 million from the city’s Housing and Economic Development bond, is at the heart of this initiative. Rather than relying on unstable federal funding like the Low-Income Housing Tax Credit, this self-sustaining fund provides low-cost loans to developers, dramatically reducing the cost of building.

A newly proposed city-owned nonprofit, the Residential Investment Corporation (RIC), would manage the fund and form joint ventures with developers, retaining majority ownership of all projects. This unique public-private partnership allows the city to maintain long-term control over housing while ensuring affordability, sustainability, and efficiency.

Each development under this model must reserve at least 30% of its units for households earning up to 80% of the Area Median Income (AMI). The remainder of the units will be offered at market rate, creating economically integrated communities that don’t rely on continuous city subsidies to be sustainable in the long term.

What makes it green?

Alongside affordability requirements, all buildings developed under the initiative must meet certain sustainability and environmental design standards. These standards significantly lower emissions, reduce energy consumption and improve indoor air quality. This directly translates to lower utility bills, saving residents hundreds of dollars annually.

A community-driven model

Unlike traditional housing programs, Chicago’s Green Social Housing initiative is rooted in community engagement, democratic governance, and social equity. Each project must undergo a community needs assessment and design process before development begins. A public design competition will involve residents in choosing the final architectural plan, ensuring that housing fits each neighborhood’s unique needs and culture.

Projects will also incorporate Community Land Trusts (CLTs)—community-controlled land organizations that keep housing permanently affordable and locally governed. Every one of Chicago’s 77 community areas will have access to CLTs, which not only preserve affordability but also ensure that land remains in the public trust, safe from speculation or gentrification.

Creating a truly inclusive city

A significant focus of the initiative is equity. Each social housing project must devote 25% of units to Permanent Supportive Housing, ensuring access for individuals experiencing homelessness, disabilities, or other high-barrier conditions. These units will be seamlessly integrated with others, breaking down social stigmas and promoting inclusive community development.

Moreover, the city plans to create a centralized placement system that will transparently match applicants to housing based on need and preference. This system will prioritize reparative justice by working with land-back and reparations groups to form intentional communities that address historical injustices—particularly toward Black, Indigenous, and other historically excluded groups.

Building for the future

This initiative also includes a Social Housing Acquisition Fund, allowing tenants the first right of refusal to buy their buildings if landlords choose to sell. The city will support these purchases, place the buildings into CLTs, and fund green retrofits—preserving affordability and quality long-term.

A participatory budgeting system will govern leftover funds from maintenance fees, allowing residents to propose and vote on community enrichment projects—from daycare centers to green spaces to food co-ops. Most importantly, the policy enshrines residents’ rights, guaranteeing long-term affordability, protection from eviction, transparency in operations, and the right to self-govern and thrive in their communities.

Chicago’s Green Social Housing initiative is a blueprint for housing justice, blending sustainability, affordability, and democracy. While details are still being debated in City Council, the vision is bold and promising. This initiative offers a hopeful path forward: one where all Chicagoans can have a safe, healthy, and affordable place to call home.