May 4, 2021

BY  LIZ BUTLER

Chicago’s Additional Dwelling Unit Ordinance (“ADU Ordinance”) went into effect on May 1, 2021. What does this change mean for Chicago?

If California’s experience with ADUs serves as an example, Chicago may soon see a dramatic increase in the popularity of ADUs including granny flats and coach houses. In 2016, California passed state-level legislation that required local jurisdictions to ease regulations on ADUs. A pair of 2017 California laws further relaxed the regulatory regime around ADUs. In contrast to other categories of building permits, California saw an eleven-fold increase of ADU permits issued since the legislative changes took effect.

Could Chicago be in for an ADU building boom?

What is an ADU?

An accessory dwelling unit (“additional dwelling unit,” as the term is styled in the ADU Ordinance) is a smaller, independent dwelling unit that may be attached or detached from a primary residential building. In Chicago, ADUs typically take the form of coach houses, granny flats, or units in basements or attics. ADUs were prevalent and legal in Chicago prior to 1957, when the City amended its code to ban accessory dwelling units. The City’s change in law and policy regarding ADUs is attributed by many as a response to post-World War II era trends including population growth, suburbanization, preferences for less dense development typologies, and concerns around overcrowding in the city.

With the 1957 amendment, existing vintage coach houses became non-conforming under Chicago’s Zoning Ordinance. Since that time, illegal conversions of basements, attics, or accessory structures into dwelling units have frequently been the subject of City code enforcement actions.

Despite their long period of dormancy, ADUs are now making a comeback. Nationwide, ADUs are enjoying an unprecedented relaxation of regulations both at the local and state level. In addition to the California legislation, New Hampshire and Oregon also passed state level legislation addressing local regulation of ADUs. Cities that currently permit ADUs include Atlanta, Austin, Denver, Honolulu, Houston, Philadelphia, Phoenix, Seattle, and Washington, D.C.  Cities in Massachusetts, Kentucky, Illinois, Indiana, and Oregon continue to explore revisions to their zoning codes to authorize ADUs.

Attitudes towards ADUs are changing for good reason. ADUs are now viewed by many as a tool to increase the stock of affordable housing, re-densify neighborhoods that have lost population, and expand housing options for different household types and stages of life. ADUs offer a great solution for young people seeking entry-level housing choices and support multi-generational housing by providing space for aging family members or adult children. ADUs may also bolster anti-displacement strategies by generating an additional stream of revenue for homeowners.

Chicago’s ADU Pilot Program

The ADU Ordinance creates the ADU Pilot Program for the purpose of allowing organic, contextual growth in the existing housing stock; creating additional unsubsidized affordable housing for moderate and low-income tenants; facilitating multi-generational living arrangements; allowing owners to retain property ownership while down-sizing living space; and allowing owners to create additional revenue streams to defray property tax, home maintenance, and other costs all within five initial designated ADU Pilot Zones.  The five ADU Pilot Zones are:

  • North: The North ADU Zone boundaries are depicted This zone includes portions of Edgewater, Lakeview, Lincoln Square, North Center, Uptown and West Ridge.
  • Northwest: The Northwest ADU Zone boundaries are depicted This zone includes portions of Albany Park, Avondale, East Garfield Park, Hermosa, Irving Park, Logan Square, Near West Side, and West Town.
  • West: The West ADU Zone boundaries are depicted This zone includes portions of East Garfield Park, North Lawndale, South Lawndale, and West Garfield Park.
  • South: The South ADU Zone boundaries are depicted here. This zone includes portions of Ashburn, Auburn Gresham, Chatham, Chicago Lawn, Englewood, Greater Grand Crossing, Roseland, Washington Heights.
  • Southeast: The Southeast ADU Zone boundaries are depicted This zone includes portions of the East Side, Hegewisch, South Chicago and South Deering.

The ADU Ordinance creates two categories of ADUs: the “Conversion Unit” and the “Coach House.” A Conversion Unit is a dwelling unit that is added to an existing residential building that has been in existence for at least 20 years. A Coach House is a detached accessory building, typically located in a backyard, and containing a single dwelling unit.

Owners of properties within the ADU Pilot Zones and which are zoned as part of an RM, RT, RS-2, or RS-3 Districts may apply to add ADUs to their property. The category and quantity of ADUs allowed depends on the existing conditions at each property. For example, Conversion Units may not be added to any lot that already contains a Coach House, nor may a Coach House be added to a lot that contains any Conversion Units.

Coach Houses are only permitted on properties containing four or fewer dwelling units. For properties containing five or more dwelling units, the property owner may add Conversion Units to increase the residential density of the residential building by up to 33 percent of the number of dwelling units that have existed lawfully in the building for 20 or more years.

Other notable provisions of the Ordinance include:

  • Parking: The addition of ADUs may not trigger an additional parking requirement. However, existing parking may not be reduced or removed to construct ADUs (without approval of zoning relief).
  • Shared Housing/Lodging Restrictions: ADUs may not be operated as a bed-and-breakfast, shared housing (such as Airbnb), vacation rental, or short-term rental.
  • MLA: ADUs are not subject to, and do not count against, minimum lot area per dwelling unit standards.
  • Design Standards: Coach Houses are subject to specific design criteria, such as maximum overall height, floor area, open space, and building separation requirements.
  • Owner Occupied: In the West, South, and Southeast ADU Zones, principal residential buildings must be owner-occupied to add a Coach House, and buildings with three or fewer units must be owner-occupied to add Conversion Units.
  • Notice Requirements: ADU applicants must provide written notice to abutting property owners and to the local alderman. Written notices must indicate the location of the property and the applicant’s intent to establish a Coach House or Conversion Unit. The applicant must also file a written affidavit certifying compliance with notice requirements as part of its building permit application.

The Chicago City Council adopted the ADU Ordinance on December 16, 2020. The ordinance went into effect May 1, 2021.  Applications may now be submitted. The full ordinance is available here.

Should you have questions on the ADU Ordinance, including issues on notice requirements or eligibility to add a coach house or increase residential density by up to 33 percent, contact Liz Butler or any Elrod Friedman LLP attorney.