University of Illinois at Urbana-Champaign Department of Urban and Regional Planning MUP ’16 – Capstone Report

Chicago’s Near North neighborhood, best known as the former site of the Cabrini-Green public housing project, has been an area of contrasts between wealth and poverty for over 100 years. In 2015 a court settlement was reached between Cabrini-Green residents and the Chicago Housing Authority, clearing a path for the construction of 1,800 new affordable housing units in the neighborhood as part of a larger mixed- income community1. Concurrently, several high- and mid-rise condominium developments have been built on the neighborhood’s periphery with more scheduled for construction in coming years.

Within the context of this significant change, this document posits a variety of strategies to integrate a new character of built form into the Near North while remaining attentive to the needs of long-term neighborhood residents and incoming public housing residents. This document consists of three sections composed with a goal of providing an understanding of the neighborhood’s past and offering strategies for future improvements to the neighborhood’s physical structure and the systems that serve its residents.

Section One attempts to develop an historical context for the Near North of 2016 through a review of the neighborhood’s history and how the neighborhood’s relative isolation from the success of the city around it has led to the state of change in which the neighborhood exists today.

Section Two centers on the work of the University of Illinois at Urbana’s Chicago Studio, an interdisciplinary, five-member collaboration between the Illinois School of Architecture and the Department of Urban and Regional Planning, whose goal was to develop an urban design- based vision for the Near North of the future based on input from existing neighborhood stakeholders and a range public and private sector professionals.

Section Three builds on the recommendations of Section

Two, offering strategies for connecting economic growth Figure 1. 57% of all jobs in Chicago are located within in the Near North to enhanced workforce development two miles of the Near North, making it an attractive systems that offer potential to better connect low and location for both private real estate development and workforce development programs that connect in- middle-skill job seekers to professional development and need residents to the city’s labor market. (Source: skill acquisition in emerging industry sectors that offer Bureau of Labor Statistics) potential for improved long-term economic outcomes.

1 This settlement effectively signaled the conclusion of a nearly two-decade-long legal battle between the Housing Authority and former residents of the Cabrini-Green housing project

EXECUTIVE SUMMARY ...... 2 ACKNOWLEDGEMENTS ...... 4 INTRODUCTION ...... 6 PLACE-BASED VERSUS PEOPLE-BASED DEVELOPMENT ...... 6 SECTION 1. HISTORY: THE GOLD COAST AND THE SLUM ...... 9 EARLY YEARS ...... 9 “LITTLE HELL” ...... 10 SLUM CLEARANCE ...... 11 EARLY YEARS OF PUBLIC HOUSING ...... 12 URBAN RENEWAL ...... 13 THE RISE AND FALL OF CABRINI-GREEN ...... 14 REDEVELOPING CABRINI-GREEN ...... 15 THE FUTURE OF PUBLIC HOUSING IN THE NEAR NORTH ...... 17 THE NEAR NORTH IN 2016...... 17 SECTION 2. TOWARD PLACE-BASED PROSPERITY: LAND USE AND URBAN DESIGN ...... 18 BLOCK STUDY ...... 19 LAND OWNERSHIP ...... 21 ZONING...... 23 DEMOGRAPHIC ANALYSIS ...... 25 EXISTING PLANS ...... 27 REAL ESTATE MARKET ...... 28 RECONNECTING TRANSIT ...... 30 ADDRESSING THE CONCERNS OF LONG-TIME RESIDENTS ...... 31 CHICAGO STUDIO RECOMMENDATIONS ...... 32 SECTION 3. TOWARD PEOPLE-BASED PROSPERITY: WORKFORCE DEVELOPMENT ...... 39 PUBLIC HOUSING AND EMPLOYMENT ...... 39 DEFINING WORKFORCE DEVELOPMENT ...... 40 CHICAGO’S DIVIDED LABOR MARKET ...... 42 SPATIAL DYNAMICS OF EMPLOYMENT IN THE NEAR NORTH ...... 43 WORKFORCE DEVELOPMENT IN CHICAGO: KEY EXAMPLES ...... 46 MEASURING THE ECONOMIC IMPACT OF WORKFORCE DEVELOPMENT IN CHICAGO ...... 48 WORKFORCE DEVELOPMENT AND TIF ...... 50 STRATEGIES FOR CONNECTING PEOPLE TO JOBS IN CHICAGO ...... 52 RECOMMENDATIONS AND CONCLUSION ...... 53 Appendix ...... 55

I would like to express gratitude to those who assisted in the preparation of this document: to Urban and Regional Planning Professor Bumsoo Lee who served as my advisor from Fall 2015 through May 2016 and whose input was integral in moving this document to its final draft, to Urban and Regional Planning Department Professor Marc Doussard, whose guidance and input on this document’s third section was invaluable, to Professor Kevin Hinders of the Illinois School of Architecture whose tireless work throughout the Fall Semester made the Chicago Studio a rewarding experience, and to Department of Urban and Regional Planning Department Head Rob Olshansky whose effort in facilitating my role as the lone urban planner in the Chicago Studio was critical to my success.

Further, I would like to thank my colleagues in the Chicago Studio: Jake Eble, Jordan Nash, Bill Smarzewski, and Sarah Turner, who taught me a great deal about architecture and whose creativity and hard work made our collaboration a rewarding experience. Additionally, I would like to thank the numerous professionals who contributed their input to the final plan recommendations in section two.

Lastly, I would like to offer profound gratitude to my family, whose positivity and support throughout my career at the University of Illinois has been a consistent source of encouragement.

Figure 2.The Near North’s location within Chicago and the surrounding region

Within the context of urban planning, the Near North offers a confounding case. On one hand, the neighborhood’s proximity to the Loop and access to and from the neighborhood itself make it an intuitive site for considerable economic development focus in an era in which Chicago’s standing as an elite global city2 makes it an attractive location for people and businesses both locally and internationally. Despite this geographic advantage, the Near North remains burdened with a legacy of social malady, and the impacts of failed public housing policy and isolation from more economically prosperous areas surrounding it remain today. Issues of transportation, housing policy, and economic development permeate through the planning process today, and a plan that comprehensively addresses each of these topics is outside the scope of a singular planning organization. Numerous plans have been drafted for the neighborhood, and the Near North remains a priority for policy makers. The purpose of this document is to produce a survey of neighborhood’s historical development to better understand the problems of today, then to propose potential scenarios for future development of both the physical neighborhood and the workforce systems that exist at the city and county scale which offer potential to connect residents at the low end of the income spectrum to improved long-term career outcomes.

This document consists of three sections, each of which has been composed with a distinctly different purpose from the other. The first is an overview of the neighborhood’s history spanning from the early days of Chicago’s settlement to the conclusion of legal battles between residents of the Cabrini-Green housing projects and the Chicago Housing Authority in the fall of 2015. The second is an overview of the recommendations produced by the University of Illinois at Urbana Chicago Studio, a collaborative between the Illinois School of Architecture and the Department of Urban and Regional Planning. Through the Fall Semester of 2015, the Chicago Studio team generated a vision for urban design and land use for the Near North of the future, envisioning a mixed-income community better connected to the neighborhoods that surround it. The third section builds on these recommendations and addresses the challenge of serving the needs of the neighborhood’s low-income residents and those of the 1,800 households of affordable housing residents who will be entering the community following the completion of new mixed-income developments. Recommendations in this section are based on research and analysis of existing workforce development systems and present a case for increased prioritization of workforce development by local policymakers.

The distinctions between development for people and development for place remain a widely-debated topic among planning theorists (Schrock, 2014). As the majority of tools available to planners are place-based in nature (e.g. zoning, transportation improvements, form-based codes, etc.), planning goals related to social equity and improving the lives of residents through direct means are more elusive. The urban design-based approach to growth in the Near North that was the focus of the Chicago Studio addresses the former through a

2 Chicago ranks 7th globally in A.T. Kearney’s index of global cities, which ranks the world’s 125 largest cities based on criteria such as business activity, human capital, information exchange, cultural experience, and political engagement.

more traditional planning approach – a land use and development vision for subareas of the neighborhood. Such an approach addresses neighborhood prosperity through the development of a more attractive place for new residents and businesses. Feedback solicited from professionals during the course of the Chicago Studio reflected strong optimism that place-based prosperity in the Near North is all but imminent, as heavy private investment has occurred following the Great Recession.

There was greater uncertainty among professionals and local residents about the effects of this place prosperity on long-term residents, many of whom remain from the Cabrini-Green era where failed policy and social disorder contributed to the isolation of the neighborhood and its residents from the city around them. In planning theory, such a scenario would often invoke a debate on gentrification3 as public infrastructure investment and encroaching development of high-end residential buildings has often signaled a future of high living costs and unaffordable real estate elsewhere in Chicago. This is not the case, however, in the Near North as the Chicago Housing Figure 3. Data Source: American Community Survey (2014) Authority is under legal obligation to return 1,800 units of affordable housing to the former site of Cabrini-Green. Additionally, the neighborhood’s alderman, Walter Burnett, is a former Cabrini-Green resident and has consistently made the provisioning of affordable housing in new developments a priority. Whether future policy is able to fully correct past failings is debatable; however efforts to connect long-term residents and the new wave of public housing residents who will be entering (and in some cases returning to) the neighborhood should continue to be a focus among city planners and policymakers.

Local organizations, most notably the Near North Unity Program, have taken the lead on people-based programs, and have even ventured into the realm of place-based prosperity4. The continued work of local community groups will remain invaluable to the long-term outcomes of residents; however people-based programs, particularly those related to workforce development, exist almost exclusively at the city, county, and regional scale. Because of this, neighborhood-scale, people-based planning cannot be expected to

3An in-depth discussion on gentrification is beyond the scope of this document. The term is used here to mean the phenomenon in which urban populations, usually of racial or ethnic minorities, are displaced at the neighborhood- scale following an influx of higher-income residents and a resulting increase in cost of living. 4 The Near North Unity Group in partnership with community group LISC Chicago and the consulting firm Teska Associates produced the Near North Quality of Life Plan and Design Guidelines in 2015, based on feedback from residents. See page 26 for more information on this plan and how its recommendations were integrated into the Chicago Studio’s final plans.

sufficiently address the challenges of connecting low-income workers to desirable job opportunities, even when those opportunities are located within a short distance as is the case in the Near North. Strategies for improving connections between low-income workers and improved career outcomes are discussed in Section Three.

Figure 4. The Near North neighborhood.

5 A subsection of the neighborhood between Cleveland Avenue and Sedgwick Street is excluded from the TIF district. This area is occupied by the Marshall Field Garden Apartments, a non-governmentally subsidized housing project constructed in 1929 by Chicago businessman Marshall Field III. It is listed on the National Register of Historic Places and was the country’s largest affordable housing project at the time of construction

In 1929, University of Chicago sociologist Harvey Zorbaugh released a study of social dynamics on Chicago’s Near North Side titled The Gold Coast and Slum. In his book, Zorbaugh juxtaposed the strikingly different fortunes of two diametrically opposite sections of Chicago’s Near North – a prosperous neighborhood stretching eastward from State Street to Lake Michigan and a cramped immigrant neighborhood to the east, stricken by high crime rates and overcrowded, deteriorating homes that sat in the shadows of the coal-burning factories that lined the banks of the North Branch of the Chicago River which formed the neighborhood’s western boundary. As Zorbaugh explains, “The Near North Side is an area of high light and shadow, of vivid contrasts—contrasts not only between the old and the new, between the native and the foreign, but between wealth and poverty, vice and respectability, the convention and the bohemian, luxury and toil.”

Nearly ninety years have passed since that description, but Zorbaugh’s depiction of a neighborhood defined by such striking contrasts remains strikingly applicable to the Near North of the twenty-first century. Although social conditions in the Near North bear many similarities to those of the 1920s, the intervening time period has been defined by persistent change as the neighborhood has transitioned from immigrant community, to a stable public housing community that gradually fell into decline during the last quarter of the twentieth century, to a neighborhood of mixed-income families and encroaching development.

The dichotomy of rich and poor, Gold Coast and slum, can be traced back to 1871. In Chicago’s early years, the land north of the Chicago River where the Near North sits today, was a predominantly industrial corridor, home to a number of livestock processing plants, loading docks, and vast lumberyards to which barges brought wood from throughout the densely wooded forests of upper Midwestern outposts in Michigan, Wisconsin, and Minnesota to feed the voracious appetite for lumber of the rapidly expanding population in the sparsely–wooded prairie region stretching hundreds of miles south and west of Chicago (Cronon). These lumberyards and the buildings of the North Division6, would become fuel for the Great Chicago Fire of 1871, which destroyed the majority of the city’s building stock, particularly the thousands of buildings north of the Chicago River.

The North Side was rebuilt quickly, buoyed by a steady stream of immigrants – largely from Germany, Ireland, and Sweden who built homes and businesses on the site of the neighborhoods destroyed by the fire. By 1884 the North Division, had a population of over 128,000, nearly double the area’s pre-fire population. Construction regulations during this time laid the groundwork for future inequities in the area, as city ordinances required areas south of Chicago Avenue to be rebuilt with more fire-resistant building material, causing many of the working class Irish and Swedish immigrant residents who had previously called that area home, to relocate north of Chicago Avenue where less expensive building construction was permitted (Mullen).

6 The city’s official name for its areas north of the Chicago River at the time

During the years following the Great Fire, the Near North was an attractive area to rebuild, and many of the lumberyards and shipping docks destroyed in the fire returned to the area returned. Heavier industrial uses also began to move into the area, which is thought to have prevented the large scale commercial developments that proliferated in the future Gold Coast from locating in the area. Large scale retail of this type would provide the Gold Coast with an anchor for economic development for years to come. Additionally, the combination of coal-fired industrial plants, factory incinerators, and passing trains badly polluted the areas along the river, earning the southwest portion of the Near North the nickname “Smoky Hollow” (Zorbaugh).

By the turn of the twentieth century, the inexpensive housing stock constructed shortly after the Great Fire had already begun to deteriorate. In tandem with the roaring smokestacks that illuminated the night sky, the neighborhood earned the nickname “Little Hell.” A clear boundary had been formed between the area bordered by the North Branch of the Chicago River to the west and the Main Branch of the Chicago River to the South, as this neighborhood now stood in stark contrast to the economically vibrant area to the west.

During the same time period, Chicago was in the midst of a large influx of Italian immigrants, particularly from the Sicily region. These new immigrants were drawn to the availability of low-cost housing in the “Little Hell” area and the close proximity to the factory jobs that lent the area its moniker. Cultural clashes between the area’s growing Italian population and the Irish and Swedish populations resulted in many of the post-fire immigrant groups moving to different areas of the city, the Swedes to the city’s Belmont corridor and the Irish largely to the city’s far north. By World War I, the neighborhood population was largely Italian, earning it appellations of “Little Italy” and “Little Sicily.”

The neighborhood remained mired in crime and the ongoing deterioration of the built environment. Prohibition-era violence earned the intersection of West Oak Street and Milton Avenue, in the heart of “Little Hell,” the name “Death Corner” due to the frequent murders that took place there – making it potentially the most violent intersection in the U.S. with over one hundred unsolved murders occurring at the site between 1910 and 1930 (Vale, 161). Zorbaugh points to the allure of gang affiliation among the community’s youth during this era as a key to the continued social disorder in the Near North of the early 1900s “The gang… affords the boy a social world in which he finds his only status and recognition. But it is by conforming to delinquent patterns that he achieves status in the gang. And every boy in Little Hell is a member of a gang.”

By the late 1920s the neighborhood was home to more than one-third of all murders in Chicago, despite accounting for only 5% of its population (Mullen). While the neighborhood would assume a world-wide reputation for violence and isolation in the latter part of the twenty-first century, it the 1920s were perhaps the most dangerous time to be a resident of the Near North (Vale, 164). Figure 5. "Little Hell" circa 1916 (Chicagology)

While the Near North struggled with high crime rates and poor housing conditions, a new demographic change began to occur in the neighborhood – an influx of African Americans from the South. As part of a larger demographic shift referred to by scholars as the “Great Migration,” more than six million Southern blacks relocated to the U.S. West and Midwest between 1915 and 1950 as a result of discriminatory Jim Crow laws and a lack of viable economic opportunity (Layson). Chicago and its thriving industrial economy stood among the most promising destinations for northern-bound migrants; however those who moved to Chicago found few options for housing. Restrictive covenants and exclusionary housing practices limited the majority of blacks migrating into Chicago during the 1910s and 1920s to a strip of overcrowded, dilapidated housing, on the city’s south side widely referred to as the “Black Belt” due to the large concentrations of black populations in these areas. The Near North offered one of the only neighborhood options on the city’s North Side, therefore despite high crime rates and substandard living conditions, many incoming blacks relocated to the neighborhood.

These new residents would quickly became the target of prejudice among the existing Italian community, and by 1935 Italian community leaders had begun to call for the removal of the 4,700 black tenants living in the Near North (Vale). Despite crime and poor housing that had existed in the neighborhood for decades, black residents were singled out as the cause of the neighborhood’s woes. Zorbaugh notes: “[The only sign of] anything approaching community feeling is the growing sentiment against the invasion of the Negro” (182).

In 1937, the passage of the federal Fair Housing Act and the formation of the Chicago Housing Authority (CHA), the successor to the Metropolitan Housing Agency which had formed three years earlier, signaled the beginning of change in the Near North. The Fair Housing Act provided funding for local housing authorities to

improve living conditions for low-income families, while the CHA, carrying on the mission of its predecessor to clear the city’s slums and improve living conditions throughout the city, sought to clear as much as thirty- six square miles of land deemed to be slums. The CHA’s objective proved to be politically divisive, and many of its initial aims were rebuffed by local alderman.

The near North was identified as one such slum area targeted for clearance; however the agency faced significant pushback from existing Italian residents who hired lawyers to prevent the agency’s land acquisition. The CHA found that homeownership rates among the largely immigrant population of the Near North were higher than those of native-born residents, and ties to those properties were strong despite the deteriorating conditions of many. Despite assurances from the CHA that these residents would have access to newly constructed public housing that would replace their current residences, these residents strongly opposed the notion of selling their properties to live in racially integrated CHA-owned housing (Hunt). Largely because of this resistance the CHA would never again attempt a land acquisition and slum clearance effort in a majority-white neighborhood (Hunt). While the CHA had initially sought to clear a fifty-five acre tract bound by Division Street and Chicago Avenue to the north and south and Larabee and Sedgwick from west to east, the agency eventually was forced to settle for an initial 16-acre section of land near the intersection of Larabee St. and Chicago Ave. which would become the Frances-Cabrini Homes.

The Francis-Cabrini Homes opened to its first tenants in July, 1942. Originally plans for the Homes were structured to allow only residents who were part of a “natural family unit” with children under the age of seventeen and annual income of $900 (roughly $13,100 in 2016 dollars), the specter of World War II necessitated the CHA shift priority consideration to military servicemen and war workers. This adjustment resulted in the ceiling for annual income of residents to be elevated to $2,100 – 140% of the median income of Chicago residents at the time (Vale).

By many accounts, life in the Francis-Cabrini Homes was good. The oral history When Public Housing was Paradise depicts a community in which black and white residents lived next to one another with minimal conflict (Fuerst). The CHA maintained careful management of the Homes in an attempt to ensure the viability of one of the agency’s few integrated public housing sites, which housed an 80% white, 20% black tenant mix, commensurate with the demographic mix of the Near North prior to the housing development’s construction. Still, racial tensions remained in the larger Near North community. Seward Park, the nearest Chicago Park District property at the time, refused to allow entry to black children until after 7 p.m., and community leaders who had first called for the ouster of black residents of the Near North continued to push for a return to the neighborhood’s all-white past (Vale). The CHA, struggled to maintain the 80/20 housing mix due to a lack of interest among prospective white tenants and a surplus of interest from qualified black families, creating circumstances in which black applicants were allowed to move into the Homes only when another black family moved out.

The 1949 Housing Act dovetailed with the CHA’s Cabrini Extension proposals submitted in 1949 and 1953, calling for the expansion of public housing in the Near North via the addition of 3,600 new units in the area surrounding the existing Francis-Cabrini Homes. The Act provided a new set of policies and funds that allowed for additional slum clearance, which the CHA seized on.

In a 1951 report bearing heavy resemblance to the observations of Zorbaugh’s study from twenty-years prior, the authors of the CHA’s Portrait of a Slum observe, “It takes only ten minutes to walk west on Oak Street from the Drake Hotel on Chicago's Gold Coast to the Cabrini Extension Area. The shabbiness of surroundings is progressive as one approaches the Area. Completion of the downhill-slide to deterioration signals arrival in the area itself” (Chicago Housing Authority, 1951). The report also highlights the ongoing struggle of black residents in the Near North, “Due to his disadvantageous position in the present housing market, the Negro is the chief victim of excessive rentals. Although white owners usually give white tenants a better break so far as rent is concerned, both white and Negro landlords exploit the Negro’s position” (Chicago Housing Authority, 1951). The report essentially affirmed the agency’s case for the expansion of public housing in the Near North as the only intervention to save what was thought to be an irreversibly deteriorating community both physically and socially.

Under long-time CHA head Elizabeth Wood, the CHA sought to construct a variety of new housing types, predominantly mid-rise buildings of similar form to the existing two-story rowhouses that provided density but to a lesser degree than the cramped slum conditions that remained throughout much of the Near North. The high cost of slum clearance, however, led many within the agency to pursue lower cost construction alternatives, high-rise construction in particular, which allowed the agency to easily meet the density requirements for public housing imposed by new federal housing policies. High-rise units, proponents argued, could also be built at a lower per-unit cost than the mid-rises for which Wood advocated, while providing the additional benefit of accommodating additional open space modeled on the “tower in the park” concept of famed architect Le Corbusier.

The CHA broke ground on the Cabrini Extension in 1955, a project to consist of 15 mid- and high-rise buildings. The clearance of the Near North as well as other large scale slum clearance projects elsewhere in Chicago led the CHA to alter its tenant requirements to allow families displaced by clearance initiatives access to new housing, many of whom possessed yearly earnings below the working-class income thresholds the CHA had previously sought to maintain (Vale, 215). The 80/20 ratio of white and black families was also lifted to allow a larger percentage of black families, resulting in only a slight majority of white tenants in the Francis- Cabrini homes as of 1954.

Also in 1954, Elizabeth Wood, head of the CHA since its inception, was removed from her position after her ongoing protestations to the Agency’s move away from fostering stable working-class communities. Instead, she argued, the rehousing of city residents displaced by urban renewal into public housing reflected the socioeconomic composition of the slums that had been cleared to make room for new public housing and was doomed to fail because it. Wood had also advocated against high-rise construction, instead favoring mid-rise rowhouses like those of the Francis Cabrini Homes, which she argued were more suitable for mothers and children; however the high-cost of inner-city land led others within the CHA to move forward with high-rise developments like that of the Cabrini Extension, which would begin to realize Wood’s Figure 5. Image of the planned Cabrini-Green Extension area from the CHA’s 1951 Portrait of a Slum report fears shortly after opening to residents.

Within a year of opening in 1958, the Cabrini Extension, consisting of roughly 1,900 units, began to demonstrate concerning signs. Due in large part to the demand created by families displaced by the CHA’s slum-clearance initiatives, the Agency was forced to move away from its model of accepting working class families toward what it described as “broken families,” or families that were receiving some form of public assistance (i.e. unemployment assistance, aid to families with children, etc.). These “broken families” accounted for roughly 45% of all residents in the Cabrini Extension. Vandalism and property damage were reported in Extension buildings within the first year; however CHA property management remained responsive to tenant issues (Whitaker, 39). Construction of eight additional 15- and 16-story high rises was completed in 1962, adding 1,096 new units to the Near North. Called the William Green homes, the new units along with the existing Cabrini units brought the neighborhood’s total public housing unit count to over 3,600 and the area of the Near North soon bore the name Cabrini-Green.

The period from 1960-1970 saw much of the remaining Italian population move from areas of the Near North that had not been claimed and cleared by CHA development. Demographics within the Cabrini-Green developments also shifted, with increasing numbers of working class residents leaving the site and increasing numbers of residents dependent on public-support7, and children outnumbered adults by a two-to-one ratio.

The CHA continued to loosen standards for new resident admission, and by 1975, 95% of all new Cabrini- Green residents were public-support dependent. Numerous gangs, often aligned by residence of each of the project’s high-rise buildings, began to rise to power throughout the 1970s, and by the 1980s crime and gang violence had permeated throughout Cabrini-Green to so great an extent that it had become a national symbol of inner-city crime and social disorder. Despite CHA efforts to reshape Cabrini-Green’s image, and a highly- publicized 1981 effort by then-mayor Jane Byrne to demonstrate the stability of the neighborhood by living in a high-rise unit for several weeks (under the supervision of heavy security)8, conditions at Cabrini-Green continued to worsen. In addition high crime brought on by pronounced gang violence within the neighborhood, the physical structure of the high-rise units had begun to deteriorate through a combination of CHA neglect and poor management by the CHA and damage caused by building residents.

As Cabrini-Green’s downfall continued into the end of the 1980s, Chicago’s Downtown had begun to grow after a period of economic stagnation in the 1970s. That growth had begun to spread north of the Loop to the area immediately north of the Main Branch of the Chicago River, brining revitalization to the newly dubbed “River North” neighborhood bounded by the River to the south and Chicago Avenue to the north. While the Gold Coast of Lake Michigan had been an area of affluence since the early 1900s, this section south of Chicago Avenue running along Wells Street had historically been a predominantly middle-income area, with an industrial character reminiscent of its early 1900’s industrial past. Development of the Old Town Neighborhood to the northwest of Cabrini-Green signaled a changing tide for the area north of Chicago’s central business district; however the Cabrini-Green area had become isolated and did saw no benefit of this positive economic change.

As the City of Chicago was beginning to experience a quickened pace of economic growth, the CHA was struggling to manage its deteriorating stock of public housing. The early 1990s saw a series of high-profile incidences of violence in Cabrini-Green that highlighted the disorder of the housing complex, and the CHA began to openly discuss the possibility of a major overhaul of its most notorious housing development.

In 1995, the U.S. Department of Housing and Urban Development (HUD) released the first iteration of the Hope VI plan, a national campaign to revitalize the country’s worst public housing developments. The same year the CHA was awarded a $50 million grant to begin the initial phases of Cabrini-Green which was to entail the demolition of 660 apartments over a 9.3 acre area of the neighborhood; however the CHA, which had been

7 The majority of which were headed by single females 8 The episode was widely seen as counterproductive to efforts of reshaping Cabrini-Green’s image.

identified by HUD as a “troubled housing authority” failed to act on the $50 million federal grant and in May of 1995, the CHA was taken over by HUD9.

The CHA, under the direction of HUD, sought to turn the Near North into a mixed-income community by reducing the high number of public housing units and encouraging new development that would integrate market-rate residents into the neighborhood. A number of new proposals were submitted for the redevelopment, including one by a local collective called the North Town Redevelopment Advisory Council that proposed turning the corner of Division Street and Clybourn Avenue into a town center, while razing all but two of the Cabrini-Green high rises. The thread of displacement ran through the proposals to redevelop the Near North. New federal mandates passed in 1996, required public housing structures to possess a vacancy rate less than 10% to remain a “viable” property, a designation which the majority of Cabrini-Green housing did not meet. While large-scale demolition seemed imminent, many existing residents fought to avoid displacement through regular protests (Chicago Reporter).

By late 1996, plans to demolish the Cabrini-Green high rises were in place; however similar to the Italian community members from nearly 60 year prior, residents obtained legal assistance to fight the impending displacement that would result from the demolition of their homes. Despite federal support of the proposed demolition, questions remained about the future of how the CHA-owned sites would be developed and where existing residents would fit into those plans. In October of 1999, following a preliminary legal agreement between the residents and the CHA, residents of Cabrini-Green were presented with two options for relocation by the CHA: obtain a housing choice voucher that would allow residents to relocate to a rental unit in the private market, or retain the right to return to a rehabbed family unit or newly constructed mixed-income development. (MPC). Outcomes of Displaced Cabrini-Green Households

Mixed-Income Public Housing 123 172 179 Other Public Housing 66 372

171 Private Market with CHA Voucher (chosen not to 215 return to CHA housing) Private Market without Voucher (in contact with CHA) 472 Private Market without Voucher

Deceased 444 Evicted, not eligible to return

Status Uknown

Figure 6. Housing outcomes of former Cabrini-Green residents as of 2009 (Metropolitan Planning Council)

9 HUD would remain in control of the CHA until 1999.

Ongoing legal battles between former Cabrini-Green residents and the CHA remained in court for nearly two decades, with a final settlement reached in September 2015. In the intervening years, all of Cabrini-Green’s high-rise units had been demolished with the final tower coming down in 2011, leaving only the original Francis-Cabrini Homes standing in the Near North; however the final legal agreement between the CHA and Cabrini residents was widely seen as a victory for former residents. The settlement gave residents a powerful lever to influence future development in the Near North as the final agreement gave residents a 50% developer stake in all new projects on the former Cabrini-Green site and mandated the CHA move forward with the construction of 1,800 affordable housing units in addition to the 895 that were built in accordance with an initial iteration of the agreement in 2001. The settlement also mandated a reduction in income requirements for units designated as “affordable” to provide greater access to former and current public housing residents (Smith). In January of 2016, the CHA in partnership with the City of Chicago issued a request for proposals for the remaining unbuilt tracts of land in the Near North10. Completion of the projects is projected for 2022, which will mark the return of 1,800 affordable units to the Near North as part of a larger mixed-income community.

As the long-stalled initiatives to rebuild public housing in the Near North finally have begun to emerge and encroaching development of a character never seen within the boundaries of Chicago’s historical “slum” begins to take root, the area of Chicago represents a unique case study in how the changing dynamics of real estate and economic development initiatives impact the character of a place. As previously discussed, the haphazard post-fire construction in the late nineteenth century, and well-intentioned, but ultimately deeply flawed high-rise public housing construction impacted the fortunes of the Near North community for nearly 150 years. How the incoming wave of development will affect the future character of the Near North is ultimately impossible to predict, but drawing on lessons from the past can serve to better inform how planners and developers approach growth in the Near North in the years to come.

10 With the exception of the original Francis-Cabrini Homes which, largely due to their historic designation by the Illinois Historic Preservation Agency, has led to uncertainty over their future development. Per the CHA, 444 of 584 units in the Rowhouses currently sit vacant, awaiting a future decision regarding the legality of future redevelopment.

Within the context of considerable change taking place in the Near North, the 2015 University of Illinois- Urbana Chicago Studio, a partnership between the Illinois School of Architecture and the Department of Urban and Regional Planning undertook a land use and design plan for future development in the Near North. Working with a broad range of stakeholders including Chicago Department of Planning and Development staff, professionals at the Chicago Department of Transportation, representatives of the Near North community, a team of architects at VOA Associates, current staff of the Chicago Housing Authority and many others, students working in a five-member team consisting of four architects and one planner11 developed a vision for the future of the Near North, including building types, land use, and transportation improvements commensurate with existing plans and input gleaned from the range of professionals who graciously provided input over the course of the semester. After three public review sessions in which feedback was solicited from stakeholders, a final plan for the neighborhood was presented on December 9, 2015. That plan and a review of the neighborhood’s existing conditions on which the Chicago Studio’s recommendations and the economic development plan in Figure 6. Final Chicago Studio review at VOA Associates Section 3, are presented in this section.

11 this document’s author

The Studio’s work began with an analysis of the urban form of the Near North. A search of city records available through the City of Chicago at the Harold Washington Library provided historical data including aerial images dating from 1938 to present, historical zoning, and historical land use data. Aerial images were particularly relevant to the studio’s study, as density, block structure, and street connectivity in the residential areas south of Division Street were among the initial foci of the planning process. Figure ground diagrams – which denote the presence of buildings relative to streets, alleys and open space – were created from the aerial images to construct an image of the neighborhood’s building density and its change over time. Figure 7 shows the change in the urban form of the Near North over time.

In line with neighborhood’s history, the figure ground study reflects the loss of building density in the Near North since the 1940s. While poor construction quality in the post-Fire years of the Near North led to high building densities, the period of slum clearance in the 1950s and 1960s led to a significant shift in the neighborhood’s density, with an additional loss occurring with the demolition of the Cabrini-Green housing projects in the 1990s and early 2000s.

The Studio’s final plan placed an emphasis on returning density to the neighborhood. Urban areas with commercial and residential uses located within close proximity to one another have the effect of decreasing reliance on vehicles as residents can simply walk to nearby stores for much of their routine purchasing. This creates additional benefit by retaining resident spending within the neighborhood, with higher densities better suited to supporting greater commercial variety. Per input from CHA staff, the Agency’s forthcoming plan for mixed-income housing will predominantly consist of mid-rise residential units, which will add significant building and residential density to the area.

Figure 7. Block Study of the Near North

Research on existing land ownership in the Near North was conducted through a review of Cook County property tax data. While land ownership records have limitations due to outdated county records, variances between property owners and property managers, and other concerns related to reliability of existing data, a high level understanding of key property owners was established. Unsurprisingly the CHA is the largest land owner, with nearly 30% of all land in the neighborhood, including a majority of the neighborhood’s currently vacant land. This data helped to establish the types of existing owners, and more generally, how those owners’ goals may inform future growth in the Near North. A number or private developers have purchased land in recent years, predominantly with the goal of constructing market rate condominiums.

Figure 8. Current land ownership

A study of existing zoning indicated land in the Near North is currently friendly to the development of high- rise residential units. The legacy of Cabrini-Green’s now-infamous high-rise residential units and the failures of high-rise public housing units in general add a degree of complexity as to whether such a design choice should be made even if it is allowable within the current zoning code. Based on input from CHA staff, who were sensitive to the potentially negative public response to high-rise construction on the former site, the Studio’s final recommendations do not advocate for construction at the maximum allowable density levels on former sites of Cabrini-Green housing.

Interviews with Alderman Walter Burnett, indicated that adjustments to zoning in the neighborhood have generally been well-received by planning staff as the neighborhood’s redevelopment has been a priority for city decision makers. Efforts to attract development to the neighborhood have resulted in a number of zoning changes to parcels within the Near North to allow for mixed uses, particularly along Division Street, a main east-west corridor through the city of Chicago that currently lacks any major commercial sites, save a Target store opened in 2013. Because of the relative flexibility of the Near North’s zoning code, this information had small influence on final plan recommendations.

Figure 9. Data source: City of Chicago

As alluded to in the Introduction, the Near North is in the midst of a significant demographic shift. As development oriented toward the city’s professional class begins to account for a larger share of the neighborhood’s residential construction, demographics are likely to continue to shift to reflect a larger share of high-income residents. As evidenced in Figure 11, median household income within the neighborhood spans from $16,411 in Census Tract 804 to over $110,000 in the three census tracts along North Avenue north of the study area. The total population in the Near North and its adjacent census tracts (the study area in Figure 11) was 49,620 as of 2014. Of those residents, 8,261 were considered living in poverty according to the U.S. Census, or approximately 17% of the Household Income of Weightlisted neighborhood’s population. Applicants for CHA Housing While the percentage of public housing residents in the Near North has fallen significantly since the 1990s, a number still remain, and more are set to move once current mixed-income housing is completed. In light of this fact, data for $0-$4,999 $5000-$9999 $10,000-$19999 existing CHA residents $20,000-$29,999 $30000+ Income Unknown citywide was reviewed to Figure 10. A total of 122,613 applicants were on the waitlist for CHA housing as of Q4 2015. develop a picture of the characteristics of future public housing residents in the Near North. These data suggest median household income numbers may remain at current levels once the 1,800 affordable housing units are constructed and occupied as opposed to increasing due to high numbers of professional class residents moving to the neighborhood’s new condos. Minimum and maximum income requirements are in place for all CHA residents (see Appendix 3); however as seen in Figure 10, a number of applicants currently awaiting placement in CHA housing are at or below the federal poverty line (see Appendix, Table 4 for poverty thresholds). Among weightlifted applicants, 111 households are former Cabrini-Green housing residents, with 89 of those 111 listing a return to the neighborhood as their preferred housing location choice among all CHA public housing (Chicago Housing Authority 2016).

Figure 11. Data source: American Community Survey 5-year data (2014)

The Chicago Studio’s objective to develop a vision for the Near North was by no means the first attempt to produce a forward-looking plan for the neighborhood. The neighborhood has been the subject of numerous plans in recent years, and a review of these plans was conducted to inform the Studio’s methodology and final recommendations. A brief synopsis of the relevant plans follows.

Released in February of 2015 in partnership with consulting firm Teska Associates and local community organizing group LISC Chicago, the plan solicited significant input from neighborhood residents in generating objectives for land use, design guidelines, and employment. The plan’s land use framework calls for a corridor-based approach to development with an emphasis on pedestrian-oriented development along Larabee and Wells Streets, a mixed-use corridor along Clybourn Avenue north of Division Street, and a low- rise pedestrian-oriented corridor on Sedgwick Street. The plan’s employment objectives center on bringing new businesses to the area and connecting those businesses to existing residents in partnership with North Branch Works, a local community development organization. The plan’s urban design guidelines generally call for more pedestrian-oriented amenities to correct the numerous open and non-landscaped pedestrian areas around the community. The plan was given the APA Illinois Implementation Award in 2015.

Adopted in 2009 by the Chicago Plan Commission, this document laid out neighborhood-scale plans for three areas of Chicago with the goal of better integrating public housing areas into their surrounding neighborhoods. The plan lays out a series of recommendations for the Near North based on a structure of short term (1-5 year), mid-term (5-10 year), and long-term (10-15 year) goals. Most relevant to the Chicago Studio was the plan’s long term goal of establishing a new elevated Brown Line train station at Division and Orleans, stating “the potential ridership projected for this location, upon completion of all proposed developments, is sufficient to justify construction of a new station (approximately 3,800 to 4,300 weekday boardings).”

Drafted in May 2003, the City of Chicago’s Central Area Plan calls for the continued focus on densification and economic development through an emphasis on accessibility and transit to the city’s central business district. While the Near North neighborhood is not included in the geography of the plan, the emphasis on expanding the Chicago Loop by Chicago’s Planning Department poses the likelihood of a ripple effect on the Near North, located roughly one-mile from the heart of the central business district.

A currently unadopted master plan for the predominantly industrial, man-made island west of the Near North was released in draft form in June 2015 by design firms R2 and PORT Urbanism. Goose Island 2025 calls for the creation of an industrial and tech cluster in line with current development trends on the island that have already seen large developments on the 160-acre island such as tech incubator UI Labs and the Wrigley Company’s Global Innovation Center. The plan also includes visualizations for potential beautification of the Island’s riverfront areas. While not an official planning document affiliated with the City of Chicago, this plan offers an indicator of the type of planning efforts underway on the island and signals the likelihood of further growth in the historically industrial area.

Research on major developments recently approved and those currently going through the approvals process provided an instructive study in the character of development moving into the Near North. Developments have largely been concentrated in the southern area of the site along Chicago Avenue bordering the River North neighborhood, which has been economically successful for the past two decades. Luxury condominiums of a character largely seen in River North have begun to move into the Near North neighborhood, representing a type of real estate unlike anything that has existed in the neighborhood. A review of several notable projects that have been approved or are in the approval process follows.

A large-scale, mixed-income development, Parkside at Old Town represents a significant development in the Near North for a number of reasons. The initial phase of development was funded heavily by Chicago tax increment financing (TIF) funds and signaled the return of private development in the Near North. Located along Division Street in the heart of the former Cabrini-Green site, the project by Chicago-based Holsten Real Estate Development Corp., received $8.2 million, roughly 20% of its total cost from the City in TIF funds and $7.8 million in earmarked federal funds from the CHA. Under then-mayor Richard M. Daley, the initial phase of development sought to attract market-rate renters to the Near North in addition to working class and subsidized units, available to holders of CHA housing vouchers (Cortman). The initial 112-unit building has been viewed as a success despite initial struggles with slow sales of market rate units, despite those units asking price of 10-15% lower than similar buildings in the area without mixed income requirements (Maidenberg).

Located south of Division Street between Orleans and Wells Streets, the nine-story Atrium Village apartment complex built as an affordable housing development in the urban renewal era of the 1960s currently sits largely vacant. Built with a super block structure the development’s main building and eight smaller buildings are set to undergo a massive redevelopment, with plans to reconstruct the site Figure 12. Rendering of Atrium Village redevelopment facing the Loop (via FitzGerald Associates Architects) with 1,500 new units in a large high- rise that will redefine the skyline of the Near North and significantly increase the neighborhood’s residential density. The project is currently stalled as the developer and local Alderman Walter Burnett negotiate the percentage of units to be designated as affordable. The property sits along the CTA rail line and current plans call for a design style suited to accommodate a Brown Line Station.

Located at the former site of City Farm, an urban farm located in the triangular lot at the intersection of Clybourn Ave and Division Street, this mid-rise, mixed-use development will further densify the Division Street corridor and add ground- level commercial units to a stretch of the Near North that currently lacks pedestrian-oriented retail.

Figure 13. Rendering of 1200 N Clybourn. One of the most controversial projects in the Near North, the (Source: Curbed Chicago) proposed 300-unit luxury condominium originally marketed itself as part of the “NoCA” neighborhood12. Pushback from residents for a lack of affordable units and the widely unpopular name ended in a retitling of the project, a reduction in the total number of units amidst concerns of increased traffic congestion spurred by its residential density, a reduction in planned parking spaces, and the inclusion of additional units designated as affordable. These concessions from the developer brought wider community acceptance for the development which is set to be completed in 2017.

12 a portmanteau of “North of Chicago Avenue”

Among the central themes of the Chicago Studio’s design methodology was the goal of better integrating the Near North into Chicago’s transportation system – specifically its elevated train or “L” line. As alluded to in the City’s Reconnecting Neighborhoods Plan for the neighborhood, Chicago planners have discussed the possibility of adding an elevated train station at the intersection of Division and Wells (see appendix for CTA route map). Interviews with the city’s planners throughout the semester revealed differing opinions among city staff on whether a station would justify the cost of construction given the neighborhood’s proximity to other transit options including numerous bus lines, recently implemented bike lanes, and L stations for the CTA Red Line a roughly ten minute walk from the center of the neighborhood.

Interestingly, research into the rail line’s history revealed the existence of a Brown Line Station at the intersection of Division and Orleans Streets from the late 1800s until 1949; however sources are scant as to why the station was removed13. With plans for the development of the 1,500-unit Atrium Village development adjacent to the proposed stop, and a revised TOD ordinance that allows for reduced parking requirements and density bonuses that allow for greater residential densities within a half mile of a transit station, the framework appears to be in place for a station to be constructed in the near future. Moreover, a new station may help increase the ease of access to many of the city’s in-demand middle-skill careers like those in the manufacturing sector (see Appendix, Figure 24) The Studio’s recommendations were based on this Figure 14. Neighborhood transit access (* the CTA Red Line is located station’s implementation. underground throughout this section)

13 Some point to the plans for increased public housing in Near North as a likely cause for Chicago decision makers’ decision to remove the stop

One of the principal challenges of the design process was producing vision that would realistically reflect current development trends while accounting for the needs and goals of long-time residents. The Near North Quality of Life Plan and Design Guidelines served as an invaluable document in informing urban design decisions with respect to the preferences of long-time residents. Additionally, a series of meetings with Pastor Ronald Blakey, executive director of the Near North Unity Program (NNUP) and NNUP program manager Sharon Wheeler provided valuable insight into the desires of long-time residents.

The general sentiment of long-time residents reflected concern over the loss of the neighborhood’s identity in favor of a new form of development that catered more to new residents than those who had resided there through the neighborhood’s most trying times. For many of these residents, new luxury condominiums developments signal to former residents of the Cabrini-Green community that the neighborhood was no longer for them (Near North Unity Program Interview). Another recurrent theme among residents was a concern that the neighborhood lacked sufficient open space for recreation, and encroaching development would further erode the open space that currently exists.

While park space is a contentious issue for existing residents, interviews with City of Chicago planning staff and Alderman Burnett indicated that the addition of increased public open space operated by the Chicago Park District was unlikely due to ongoing budgetary concerns within the Park District that make the prospect of added open space untenable. Interviews with Chicago Housing Authority staff, however, suggested the prospect of semi-public open space to be managed by the developers of future mixed-income housing as a viable possibility. This option would allow for additional outdoor space Figure 15. NNUP executive, Pastor Randall Blakey. Photo credit: Near North Unity for incoming and existing residents, with these spaces tailored to Program the needs of different age cohorts within the community (e.g. quiet areas for seniors, interactive play areas for young children, and recreation areas oriented toward young adults.)

Based on existing and proposed developments, existing plans, and stakeholder input, the Near North team produced a neighborhood-scale vision of the neighborhood, and how development can continue to best leverage the existing desirability of the land to meet the needs of both new and long-term residents. The neighborhood was divided into four subareas (see figure 16) and plans were designed to address the unique characteristics of each section. Recommendations by subarea follow.

In line with the projected development at Atrium Village, a plan for a mixed- use hub based around a new Brown Line station was the central component of the eastern section of the site (see Figure 17 on page 36). Inspired by the design of the CTA Green Line Bronzeville Figure 16. Subarea divisions Station, this plan calls for the integration of a new station that would be integrated into a commercial/institutional building that would include a new neighborhood library (replacing an existing library that would be relocated as part of this development plan), and commercial areas to service transit riders. This subarea would increase building density based around the Brown Line and draw pedestrian traffic westward along Division Street from the economically vibrant Old Town neighborhood to the east. In tandem with Seward Park located along Division Street, this new station would create a “front door” for the Near North and catalyze growth in the neighborhood. Additional density along Wells Street is also a key component of this subarea.

While the western section of the Chicago River’s North Branch bears the markings of Goose Island’s industrial past, the area currently sits as an underutilized section of riverfront, consisting largely of surface parking, warehouses, and industrial storage area (see Figure 18 on page 37). With the neighborhood’s increased attractiveness to private development, this subarea is poised for redevelopment. In line with the vision of the Goose Island 2025 master plan, riverfront beautification is the driver behind this subarea’s redesign. In addition to an improved riverfront that would improve the ecological condition of the river after decades of industrial use and reopen the corridor to recreation, two significant interventions have been proposed to the site.

Near North Selective Enrollment High School: A project formerly known as Obama College Prep that would situate a new college preparatory high school in the Near North to replace the Near North Career Metropolitan High School which closed due to low enrollment in 2001. The high school has been in the planning phases for several years with several sites under consideration; however interviews with NNUP representatives and Alderman Burnett indicated the desire for a high school located along the riverfront, which would add a unique intuitional amenity to the Near North and double as a critical institution for improving outcomes for existing and future students in the neighborhood as current plans call for a minimum of 30% of the high school’s enrollment to come from neighborhood students (Biasco).

Halsted Obelisk: A residential/office tower near the intersections of Halsted and Division Street was proposed as a project similar to the proposed Atrium Village development at the neighborhood’s eastern gateway. The recommendation dovetails with the projections of Goose Island as a future employment hub in the city and would leverage the amenity of an improved riverfront to offer Goose Island workers an attractive living option in line with design trends of current developments coming on line in the Near North. In addition to market rate housing, the tower would offer affordable 20-30% of its units at an affordable rate and include office and institutional space for workforce development and skills training. A new Brown Line station14 is critical to this project as current transportation options limit the viability of a high-density building at this location.

14 an approximately five-minute walk from the proposed building

The largely CHA-owned area of the Near North located North of Division Street would align with goals laid out in the Near North Quality of Life Plan and the CHA’s Plan for transformation through the inclusion of mid- rise mixed-income housing, and include small private park space for residents in line with the input gleaned from existing community members (see Figure 19 on page 38). In addition to mid-rise housing, this subarea plan also calls for the redevelopment of a strip mall style commercial area currently located near the northeast intersection of Division and Clybourn Streets that would leverage TOD bonuses associated with a newly constructed Brown Line station. A new high-rise on this site would leverage pedestrian traffic generated from the new station and offer increased residential units oriented toward professional class workers traveling to and from the Loop.

As a current site of the majority of the Near North’s existing mixed-income housing stock, this site plan builds on this existing development (see Figure 20 on page 39). Much of this area currently sits vacant and is owned by the CHA, and is a primary location for the construction of the additional 1,800 units of affordable housing the CHA is under obligation to construct. Similar to the North Subarea, this plan integrates small pockets of open space into the design of future mixed-income development. The site also seeks to address the challenge of redesigning the Francis-Cabrini Row Houses that have been set for demolition by the CHA.15 This design also acknowledges the likelihood of future high-density residential development along the Chicago Avenue corridor in line with the development currently underway in that section of the Near North and therefore includes one high-rise along Chicago Avenue.

15 The rowhouses are currently under protection by the Illinois Historic Preservation Agency and the CHA has yet to issue an RFP for the redevelopment of the site that includes them. Per the CHA only 146 of 440 rowhouse units are currently occupied due to the uncertainty of their future development.

Figure 17. The Brown Line subarea (facing southeast) includes a new transit station and higher-density office and residential construction along Wells Street. Image credit: Bill Smarzewsi

Figure 18. Goose Island subarea (view facing northeast from the Chicago River). Image Credit: Jake Eble

brownline stop @ division

Figure 19. CHA North subarea, facing northeast from Division Street. Image credit: Jordan Nash

Figure 20. CHA South subarea facing northeast from Chicago Avenue and Halsted Street. Image Credit: Sara Turner

While the place-based prosperity described in the previous section is inarguably important to the future of the Near North, the prosperity of place alone does not ensure improved outcomes for residents, and in the case of the Near North, many long-time residents have weathered a long-period of isolation from the prosperity of adjacent neighborhoods. Further, the construction of 1,800 new affordable housing units will bring an influx of new residents whose employment needs may present new challenges for the area’s existing workforce systems. In light of this reality, a people-based approach to development in the neighborhood is also necessary to produce improved outcomes for residents.

Building on the place-based recommendations produced by the Chicago Studio, this section offers a people- based approach for growth based on workforce development, an economic development approach that aims to connect workers with jobs, with the ultimate goal of those workers moving up defined career ladders and achieving outcomes that would be more difficult to attain without the existence of an established workforce development system. This section posits a series of strategies for connecting such a system to residents of the Near North and describes, more generally, how such a plan may better serve job seekers in the Chicago Region.

In 1996, federal legislation widely referred to as “welfare reform” ushered in a new policy emphasis on the role of public housing in the United States. This wave of programs emphasized placing residents of public housing into jobs or community service – a connection made clear with initiative names such as “Operation Bootstrap” and “Project Self-Sufficiency.” The Quality Housing and Work Responsibility Act, passed in 1998, altered public housing rent policies to include work requirements, mandated community service for residents who were unemployed, and placed further emphasis on self-sufficiency programs. The purpose of these programs was to transition the role of public housing in the U.S. from a long-term solution to the housing needs of the country’s most disadvantaged to a more temporary role that helped serve families’ needs as they transitioned to self-sufficiency (Kleit 2005, 83).

While public housing authorities, the CHA included, have taken a number of approaches to assist residents in meeting work requirements16, some proponents of mixed-income housing have argued that mixed-income communities themselves function as an ends to helping low income residents achieve greater success in the job market. In Job Search Networks and Strategies in Scattered-site Public Housing, Rachel Kleit finds that low-

16 The CHA was slow to enact work requirement measures, approving them for eligible residents in 2007 with the mandate becoming effective two years later

income residents living in mixed income neighborhoods may indeed have better information available to them when searching for employment. Kleit also finds that these residents are more likely to engage in job searches using more formal means (e.g. reading classified ads and searching for help wanted signs), whereas residents of majority low-income neighborhoods tend to rely on social networks through more informal approaches such as word of mouth – an approach thought to be more limiting to women, who make up the majority of heads of households in CHA housing (Kleit, 2002) (Center for Urban Economic Development). Further, research suggests that quality housing conditions are associated with public housing residents achieving employment outcomes that allow them to reach self-sufficiency (Kleit, 2005).

This information is promising in that it supports the widely held belief among policymakers that mixed- income housing like that currently built and planned-for in the Near North is a significant improvement on failed models like the Cabrini-Green projects. While promising, the body of research on the subject remains small, and simply living in a mixed-income community is probably unlikely to be a sole driver for improved long-term career outcomes.

Workforce development systems offer perhaps the most promising avenue for low-income residents of the Near North to move toward improved long-term career outcomes. The underlying concepts behind workforce development have roots in partnerships between public and private institutions dating back more than a hundred years to public schools which functioned as employment training systems for employers that sought to ensure a reliable labor supply that possessed functional math and literacy skills and could perform trade- specific tasks (Blakely). The term “workforce development” emerged in the 1990s to capture elements of the disparate fields of job training, economic development, community development, and job training (Giloth). The term’s use, especially in the context of urban planning is somewhat difficult to define; however economic development theorist Greg Schrock provides a useful definition, describing workforce development as:

Policies, programs, and institutions that assist workers and employers in connecting with one another, making future-oriented investments in labor force skills, and promoting career advancement and mobility toward goals of household, business and community, and regional economic prosperity. (Schrock 2014, 257)

The principles of workforce development have roots in human capital theory, which argues for the role of the public sector in labor training, with the logic that, in knowledge-based economies, firms are prone to underinvest in the skills that they require due to the high cost of providing training and the concern that newly-trained employees will move to other firms. While the public sector does support colleges and universities, those institutions alone are oftentimes insufficient to produce the high-skilled workers sought by innovative firms. Therefore, public sector investment in workforce training to develop human capital stocks at a regional scale is necessary in order to ensure long-term economic growth (Mathur). While this notion is generally agreed upon by economic development professionals and policymakers, a “best practices” approach

that both enhances interregional economic competitiveness while also serving the needs of low income workers remains elusive (Schrock, 165).

The latter part of this elusive best practices model is particularly relevant to a discussion on achieving people- focused economic development goals in the Near North. Low-income workers, or individuals who have spent long periods of time out of the workforce such as immigrants, high school dropouts, and single mothers face added challenges related to reentering the workforce and often lack the skills necessary to be considered for most types of employment. On the employer side, inefficient training programs and poor communication systems often provide disincentives for engaging with workforce development intermediaries (Rogers). Employers often argue that the costs associated with training employees do not justify internal workforce development investment as worker mobility between firms effectively penalizes employers that invest in workforce training and rewards employers that underinvest in training and instead “poach” workers from firms that do invest in workforce training. Somewhat paradoxically, lower-skilled workers are the least likely to receive workforce training from their employers (Wadoups), leaving a region’s least-skilled workers without viable career ladders to improve their long-term economic standing.

The concept of career ladders is an important one in the context of low-income workers. As many workers reentering the workforce face significant barriers to attaining employment at all, the ability for those workers to then advance to more secure, long-term employment is oftentimes limited. A range of approaches to this dilemma exist. Generally these programs seek to help hard-to-place workers in entry-level positions that offer the prospect for advancement after experience and additional education and/or training is completed. Career ladders in the medical field (e.g. nurses’ aides transitioning to licensed nurses) and I.T. field (e.g. administrative workers advancing to information technology professionals) are often highlighted as notable examples of the concept (Blakely).

Because low-skilled workers are oftentimes part of disadvantaged communities, planners who focus on developing the skills and job networks through workforce development programs can help those communities build economic assets and community power (Schrock, 2013). This applies even in an emerging mixed-income community like the Near North. Whereas proponents of the role of place-based prosperity may point to the neighborhood effects that help low-income residents achieve self-sufficiency and improved life outcomes, a comprehensive plan for neighborhood development must include a connection to a larger workforce development network well-supported by both the public and private sectors.

For much of the twentieth century, Chicago was widely considered the industrial capital of the Midwest; however the city, like many others in the region, experienced a significant loss of jobs in the industrial sector beginning in the 1980s (Doussard). The bottoming out of the region’s manufacturing sector forced the city to transition to a redefined economy, which it did successfully to the point that its resilience is an oft-cited model for success in the face of deindustrialization (Cowell). The move away from a manufacturing based economy to a service based economy has resulted in regional advantages in industry sectors like finance, information technology, and management (see Appendix, Table 5).17

While the move to a service-based economy has buoyed the city’s economic health in the era of deindustrialization, the jobs that have driven Chicago’s success generally have high barriers to entry. The finance and insurance sector, for example, employed 182,350 throughout Cook County as of 2015 (the majority of which are in Chicago), of which over 65,000 are considered export jobs18. Occupations within this sector include accountants, budget analysts, and personal financial advisors with median yearly wages in the Cook County labor market of $89,738; $90,879; and $133,533 respectively.19 These positions require, at minimum, a bachelor’s degree, and job growth in this industry sector is expected to increase by 8% in the next decade according to Bureau of Labor Statistics estimates.

Despite the strong prospects for growth in many of Chicago’s high-skill service sector industries, “skills gaps” persist in many high-paying, high-skill sectors. Skills gaps refer to disparities in the number of jobs employers are seeking to fill and the number of job seekers possessing those skills. Moreover, many of the city’s residents remained disconnected from avenues for jobs that pay even middle class wages. Between 1983 – approximately the time the city began to lose manufacturing jobs at a rapid pace – and 2004, those in the bottom quartile of Chicago’s labor force experienced a 7% loss in wages in real dollars, meaning a full-time worker in the lowest 25% of earners was paid $12.65 per hour in 1983 and $11.75 per hour in 2004 (Doussard).

This issue is not unique to the Chicago market as wage polarization has occurred nationally, with earners at the bottom of the economy being disproportionately affected and earners in high-skill service sector positions thriving more than ever. A number of policy approaches to this type of income inequality within the context of workforce development have been posited, with some demonstrating potential for success. The essence of these approaches centers on connecting job seekers to career ladders that emphasize skill acquisition en route to higher paying, skilled jobs. These approaches and how they may apply to a community with a high number of low-income residents like the Near North will be discussed in the conclusion of this section.

17 Regional advantage is measured by the location quotient metric which factors total jobs at the county level relative to the expected number of jobs per national averages. 18 Similar to location quotients, export jobs is a metric that estimates the total number of jobs in excess of what would be expected based on the size of the labor market. Therefore the services provided by these excess jobs are in essence being “exported” to other areas of the U.S. 19 Bureau of Labor Statistics

To achieve a greater understanding of where and who is employed in Chicago and the Near North neighborhood, a GIS-based analysis of the U.S. Census Bureau’s 2014 Longitudinal Employer-Household Dynamics Origin-Destination Employment Statistics (LEHS) data20 was conducted. LEHS data contains information on the characteristics of employment by place of work and characteristics of employment by residents of a specific geography – in other words, using this data to study the Near North offers insight on both the characteristics of jobs in the near North and the characteristics of the employment held by residents of the Near North.

In terms of employment proximate to the Near North, 766,400 total jobs are located within a two-mile radius of the neighborhood, approximately 57% of all jobs in the Chicago (See Figure 21). Within the boundaries of the Near North, jobs within the neighborhood exceed the number of jobs held by residents by roughly 3,300. While the scale of this data is too small to glean significant results, the presence of a number of high-skill service sector jobs within the neighborhood may suggest a skills gap between residents within the community and the jobs that currently exist there (see Table 1). Occupations in high-skill sectors within the Near North include 2,094 jobs in the professional, scientific, and technical services sector and 489 jobs in the aforementioned finance sector (see Appendix Table 6 for data for all of Chicago)

Residence Area Work Area Total number of jobs 5,880 9,186 Jobs for workers age 29 or younger 1,712 1,220

Jobs for workers age 30 to 54 3,409 2,076

Jobs for workers age 55 or older 759 232

Jobs with earnings $1250/month or less 1,115 1,899

Jobs with earnings $1251/month to 1,245 2,807 $3333/month Jobs with earnings greater than 3,520 2,599 $3333/month Table 1. Data source: Bureau of Labor Statistics LEHD

Factoring in transit access provides an even broader context on the job market within range of the Near North. Based on data for Census Block Group 170318383001, which encompasses the majority of the neighborhood, 899,847 total jobs are accessible within a thirty-minute transit ride.21 These jobs broken down by educational attainment can be seen in Figure 22 (the spatial distribution of jobs in the region’s four highest export job producing sectors can be found in Appendix, Figure 25).

20 the most recent year for which data was available 21 Data collected using the Center for Neighborhood Technology’s AllTransit tool.

Figure 21. Data Source: BLS LEHS 2014 (“All Jobs” dataset)

The data in Figure 22 provide the basis for another important point about the job LESS THAN HIGH market for under- SCHOOL, 79,958 HIGH SCHOOL, ASSOCIATES 146,321 skilled residents of DEGREE OR LESS, Chicago and the Near 430,012 North. A discussion ASSOCIATES DEGREE, 203,733 on connecting workers to jobs must also stress the importance of connecting those BACHELOR OR workers to education HIGH SCHOOL OR ADVANCED, LESS, 226,279 and skills training as 271,011 opposed to low-skill jobs that fail to provide Figure 22. Data source: Center for Neighborhood Technology pathways advancement. Per the national data in Appendix Figure 26, median weekly earnings for workers whose highest level of educational attainment was a high school diploma was $678 in 2015 compared to $798 for those with associates degrees and $1,137 for those with Bachelor’s degrees. Unemployment rates for those with lower levels of educational attainment are also significantly higher as seen in the accompanying figure.

Connecting employers and job seekers has been an evolving challenge for planners and economic development professionals in Chicago. As previously discussed, the city’s transition from manufacturing economy to service economy has left many workers looking for jobs without the necessary skills to find them, and it has left many employers unable to find qualified workers. In order to correct this market failure, the city has undertaken a number of workforce development initiatives. The examples that follow serve as noteworthy case studies.

Oft-cited as one of Cook County’s most successful workforce development programs is the ManufacturingWorks initiative. Initiated in 2005 by the City of Chicago Mayor’s Office of Workforce Development, the program moved away from the city’s One Stop22 model to a sector-based approach that focused on the needs of employers in in-demand industries to more effectively deliver workers to employers, and in turn create stronger relationships between workforce intermediaries and hiring firms. Initial funding for the ManufacturingWorks program came from redirecting 6% of the city’s Workforce Investment Act funds away from One Stop programs toward two sectoral workforce centers – one for the manufacturing sector, the other for the service sector23. Perhaps most notably, ManufacturingWorks adopted an approach to worker placement that emphasized “high road” employment practices, which sought to place employees in well- paying positions with upward mobility24. Although this approach decreased the number of overall placements, average hourly wages for new placements increased from $11.23 to $12.49 (Schrock, 2013).

The Opportunity Chicago initiative presents another model for workforce development. With its focus on public housing residents, the initiative provides a particularly illustrative path for future workforce plans. In 2006, a multi-agency collaborative between the CHA, Chicago Jobs Council, Chicago Department of Family Support and Services, and Partnership for New Communities (PNC)25 was formed to improve the workforce system for residents of Chicago’s public housing system. The initiative began with $27 million in funding through a range of funding streams including $13 million from the CHA26, and $5.2 million from the PNC. The

22 One-stop programs are employee-focused centers that generally assess an employee’s skills and aid various steps necessary to job procurement. 23 ManufacturingWorks’ partner program ServiceWorks, which aimed to place workers in low-wage service sector occupations including food service, hotel, and retail positions. 24 The ServiceWorks program produced less impressive results with respect to placement in “high road” positions, and is therefore not used as a model for this report. Schrock suggests a program like ServiceWorks may be more successful if coupled with policy such as an increased minimum wage. 25 A not-for-profit workforce group funded by the MacArthur Foundation to push for improved workforce systems for low-income Chicago residents. (Per the report: “A time-limited funder collaborative created to support the goals of The Plan for Transformation, PNC co-founded Opportunity Chicago and was a lead funder and strategist for the Initiative. PNC helped staff the Initiative and granted and administered $4.8 million in Opportunity Chicago programs.”) 26 Largely originating from federal funds earmarked for local programs through the Moving to Work program, which also included a work requirement for all residents of CHA housing aged 18-61. Heads of household were required be employed or engaged in training for at least 30 hours per week (Chicago Jobs Council, 22)

initiative was rooted in the CHA’s Plan for Transformation and began with a goal to help 5,000 public housing residents find employment throughout the five-year life of the program. The initiative focused on six programs designed to meet the range of needs among public housing residents:

 FamilyWorks: A comprehensive case management-based program in which case managers worked with residents to develop job preparation skills (“soft skills”). The program focuses focused on direct placement and job retention among employees less suited for sector-based strategies.  Transitional Jobs: a program focusing on the hardest to employ; this approach entailed skill development, supportive services, and temporary, subsidized employment placements to help residents with little or no work history transition into the labor market  City Colleges of Chicago: Provided no-cost classes in career programs and technical skills training. Over 1,403 residents participated in the program during the life of Opportunity Chicago.  Workforce Investment Act (WIA) Services: Entailed a three-tiered approach to the delivery of training service as mandated by federal act of the same name; these programs included access to job preparation materials, skills assessment, and technical training.  Industry Skills Training: Targeted training for in-demand sectors like the aforementioned ManufactuingWorks and ServiceWorks programs  Contextualized Literacy Program: Focused on improving reading levels among working-age residents with services targeted toward linking improved literacy levels to target occupations

A review of Opportunity Chicago’s performance following its conclusion in 2010 showed generally positive results. Despite much the program’s timeline aligning with the Great Recession, 5,185 residents were placed into employment over the course of the program, 77% of all who participated in the program. Job placements increased in each successive year of the program, and 54% of residents retained employment for two or more years following placement (Center for Urban Economic Development). Employment was based largely in three sectors which accounted for over 50% of all placements – Health Care and Social Assistance (31%), Retail Trade (13%), and Accommodation and Food Services (10%). Overall, the initiative demonstrated the powerful impact a well-funded, and well-planned development strategy can have on a region’s hardest-to-place workers.

In order to assess the impacts of workforce development on the Chicago economy, an input-output model was used to gain a sense of the “dollar in, dollar out” return on workforce development spending. This analysis uses IMPLAN modelling software to assess economic impacts based on the industry sectors to which workforce development funding was spent in the Opportunity Chicago program. Opportunity Chicago was used as the basis for this model due to its inclusion of a range of programs, from Transitional Jobs which provided career assistance to the hardest-to-place segment of the city’s workforce to Industry Skills Training, which followed a more translatable case for workers seeking to acquire skills oriented toward in-demand industries. IMPLAN uses proprietary algorithms based on regional trade data to model the effects of expenditures at the county level, therefore the results of this model reflect the impacts to the Cook County economy.

Several assumptions were made in the model. First, inputs were entered to total $27 million equally distributed over a five-year period. While Opportunity Chicago’s funding was not distributed in five equal increments throughout the initiative’s five-year duration, this input provides a rough approximation of the effect of program spending over that period. This spending was input into the model under the category of “Industry Spending“ weighted by industry using the percentage of workers placed in each of the top ten placement sectors (Appendix, Table 7). This approach gives an approximation of the stimulus effect of program spending on programs by sector. A summary of the output is shown below.

Impact Type Employment Labor Income Total Value Output Added Direct Effect 191.4 $8,904,764 $13,182,984 $23,676,975 Indirect Effect 43.9 $3,059,498 $4,779,883 $8,543,026 Induced Effect 53.3 $2,972,146 $5,105,643 $8,678,082 Total Effect 288.6 $14,936,409 $23,068,510 $40,898,084 Table 2. Data source: IMPLAN

The above figures demonstrate a multiplier effect of 1.51, which suggests workforce development spending is a strong investment. A breakdown of occupations that demonstrate the highest impacts in terms of employment added can be found in Appendix Table 8. Based on the data gleaned from Opportunity Chicago, in which the largest number of job placements occurred in medical and social assistance occupations, results expectedly reflect the highest impacts in this sector, with an additional 54 jobs added to the economy in occupations under the “Medical and diagnostic labs and outpatient and other ambulatory care services” classification27. Overall, a $27 million investment in workforce development results in approximately 288 jobs added countywide or $14,936,409 in added labor income. Direct industry impacts (Appendix, Table 9), reflect the industry spending inputs mentioned in the previous paragraph, with the medical services industry sector demonstrating the largest output.

27 IMPLAN’s proxy for medical and social assistance occupations

In addition to the direct effect of workforce development spending on the Cook County economy, the model provides figures for the indirect and induced impacts of that spending. These figures represent the additional impact that occurs as a result of funding to workforce development-oriented programs (e.g. newly-hired employees purchasing additional household goods or community colleges purchasing additional educational software). Real estate establishments experience the greatest indirect impact with $1,105,632 in additional economic activity, followed by management of companies, and management of services with indirect impacts of $458,497 and $440,844 respectively. Rental activity of owner-occupied dwellings reflects the highest induced effect with an impact value of $756,537, followed by real estate establishments and private hospitals with induced effects of $501,299 and $493,992 respectively. These totals align roughly with the added28 housing and medical care needs of new employees added to the economy. Workforce development spending also produces state and local tax revenue. Taxes on production and imports reflect the largest sum of tax revenue with $1,157,415 in taxes generated primarily through sales and property tax. While a relatively small overall total.

With respect to jobs offering career ladders, the effects of workforce development spending demonstrate mixed results with a number of jobs created in both low-skill occupations like food service (42) and retail (17), and occupations more associated with career advancement like family services (36) and administrative services (20). This may be a reflection of Opportunity Chicago’s emphasis on investment in job placement of low-skill, high-barrier workers in programs like Transitional Jobs, which sought to help many participating workers simply re-enter the workforce as a first step to future employment.

It is important to note that IMPLAN is limited in its ability to model the economic impacts of workforce development that are not stimulus-based. The improved long-term earning potential of program participants, for example, cannot be modeled due to the high variability inherent to forecasting such effects. Moreover, the enhanced human capital stock of the region with a workforce possessing skills better oriented toward in- demand jobs cannot be modeled, therefore a county with employers better able to find trained workers is likely greater than the 1.51 multiplier demonstrated by the model. Additionally, the societal impact of engaging a labor market’s most disadvantaged participants presents a number of positive externalities that cannot be captured in an IMPLAN model (e.g. reduced public expenditures in areas such as health care and criminal justice). Further, improved life outcomes for the children of better-trained workers have been posited as a significant benefit of workforce development programs (King). Because these factors are generally outside the scope of an input-output model’s capacity, the actual economic impact of workforce development is likely significantly greater than that demonstrated by the model.

28 The term “added” does not necessarily refer to employees that entered into the region. This spending occurs as a result of a worker who would not be earning wages in a given sector but for additional workforce development spending, regardless of where that employee originated prior to the increased spending.

Despite the success of workforce development programs like ManufacturingWorks and Opportunity Chicago and the economic arguments for workforce programs’ role in enhancing regional economic outcomes, obtaining funding for workforce programs remains a challenge, particularly from local sources. An enhanced policy focus on workforce development based on developing enhanced funding streams to successful programs like those mentioned in this report would help to ensure that access to these programs remains consistent. The tax increment financing (TIF) mechanism widely used in Chicago and Cook County offers a particularly attractive potential source of local funding.

In short, TIF is a tool used by local governments to increase private investment in an area defined as “blighted.”29 Figure 23. Map of TIF districts in Chicago After a TIF is established, local government units (e.g. schools, park districts, etc.) only collect taxes at the rate of an area’s assessed property values at the time the TIF is established with any added property tax revenue derived from increased property values within the TIF going to a fund to be spent on a range of neighborhood improvement uses within the district over the life of the TIF30. Currently the City of Chicago allows for the use of Tax Increment Financing (TIF) for workforce programs, but these programs are generally given little consideration compared

29 The definition of “blighted” has been criticized as being particularly subjective (Quigley) 30 Usually 27 years with an option to apply for an additional 13 year extension. The City of Chicago very rarely rejects a TIF extension (Neighborhood Capital Budget Group)

to items like capital projects and incentives for “footloose” firms, or businesses prone to relocating large some or all of their business operations to more attractive business settings. Spending within the Near North TIF (see Appendix, Table 10) provides an instructive example of the priorities of local officials in using TIF funds to drive economic growth, but as seen in the previous section workforce development initiatives do offer significant promise for economic growth.

A number of analyses have looked at the economic efficacy of the continued practice of TIF districting as an economic development tool in the Chicago region, and results generally demonstrate mixed or negative results. Chicago began the practice in the 1970s with the creation of a TIF in its central business to counteract economic leakage to competing suburbs (Gibson). The practice grew in popularity, and by 2007 Chicago was collecting $500 million yearly from over 120 TIF districts throughout the City (see Figure 23). Despite their wide popularity, T William Lester, in his study of the job creation and economic development impacts of TIF spending Does Chicago’s Tax Increment Financing (TIF) Programme Pass the ‘But-for’ Test? finds no empirical evidence connecting TIF districting with improved economic outcomes, observing:

Despite its extensive use throughout the City of Chicago [there is] no evidence that the TIF program resulted in any significant new job creation. While some individual TIFs may have positive impacts, Chicago’s use of TIF has not resulted in positive net employment benefits for city residents.

The lack of demonstrated success of TIF districting suggests a new approach to how TIF funds are spent. The City of Chicago’s TIFWorks program offers an avenue to better connect TIF to workforce development initiatives. Although the TIFWorks programs exists as a potential resource for local alderman to employ in their district, the program has been used sparsely with only 41 of the city’s 162 TIF districts using the program, and total expenditures of $4.3 million as of 200831 (Fortino). With such small TIF expenditures on workforce development in a city bringing in over $500 million in TIF revenue yearly, an emphasis on better applying TIF funds to workforce development seems intuitive. Chicago’s workforce development programs have demonstrated success in leveraging funding to connect workers to employers throughout the city, and increased policy focus on funding these programs should view TIF as a prime funding source.

31 the most recent year for which data is available

Because of the often hard-to-define nature of workforce development, a single, comprehensive approach to workforce development for all segments of a region’s workforce is beyond the scope of even the most ambitious policymaker, but several programs and emerging approaches to improving outcomes for job seekers and workers offer potential to improve outcomes for job seekers, make finding workers a more efficient process for employers, and enhance regional human capital stocks.

Among the most promising approaches to addressing the issue of skills gaps is the apprenticeship model. Programs in which workers work alongside skilled staff while gradually acquiring skills and moving up a career ladder were once prevalent in U.S. work places, but with the decline of private-sector labor unions, such programs have become rare (Kochan). While rare, those that do exist have demonstrated positive results. As of 2012, over 360,000 people were enrolled in apprenticeship programs in the U.S. – a majority of which were within unionized companies. These programs typically combine on-the-job experience with a classroom curriculum based on learning criteria established by a labor board or state agency. Estimates of the benefits of these programs suggest graduates on average gain an additional $250,000 in lifetime earnings, while employers who participate in apprenticeship programs see a 35% return on investment due to lower recruiting costs and reduced need to hire contractors to perform skilled labor that program graduates are equipped to perform (Kochan). In short, apprenticeships in in-demand industries offer the potential for employers to connect with workers seeking to develop skills that will lead to stable, well-paying jobs.

Sector-based programs offer another means in which workforce development can function to alleviate the market failure of skill gaps. In the Chicago region, the Chicago Metropolitan Agency for Planning (CMAP) has identified three industry clusters32 that offer potential to connect workers with in-demand jobs. CMAP identifies three mid-skill33 manufacturing occupations that the Chicago region continues to experience persistent job openings and insufficient numbers of training completions to meet hiring demand: mechanic and repair technologies, precision production, and transportation and material moving. Somewhat paradoxically, two of these three clusters34 fall within the manufacturing sector, which as previously discussed experienced significant job losses in the last two decades of the twentieth century. CMAP argues for more strategic planning to better align current educational offerings and skills training throughout the Chicago region to the growing demand for these positions within the region (Weil). Such a sector targeting approach is a common thread throughout many workforce development programs, and improved data acquisition by public sector organizations like CMAP offers promise to better connect workforce development initiatives with well-paying, in-demand careers with relatively low barriers to entry.

32 An industry cluster refers to a network of related firms in a region that share suppliers, specialized infrastructure, and markets Their co-location represents a regional economic advantage (Blakely) 33 CMAP uses the term “mid-skill” to refer to jobs that require a high school diploma but not necessarily a college degree. 34 Transportation and material moving falls within the Transportation and Warehousing industry sector.

In a similar vein, community colleges offer the potential to play an increasingly important role in connecting workers to in-demand jobs, particularly for older job seekers. Many community college programs cater to part- time students, older students, and first generation students; and their impacts on life outcomes can be significant, especially for women who on average experience 39% greater lifetime earnings when attaining an Associate’s degree (Kochan). Currently over four million community college students take courses online. As seen in the Opportunity Chicago program, training programs through the Community Colleges of Chicago were a key component of participants’ attaining new skills. Coordination between employers in target industries like those identified by CMAP and Chicago’s community colleges offers the potential to significantly address regional skills gaps and better-connect job seekers in the Near North and elsewhere to career opportunities.

Based on the aforementioned strategies, a number of potential avenues for connecting low and middle skill workers in the Near North to the skills the region’s employers currently desire and in turn enhance potential for long-term career outcomes. Connecting these strategies to improved funding streams would offer the potential for improved people-based outcomes.

Continue to support access to Community Colleges of Chicago technical training and increase access to e-learning options. Because public housing residents may face constraints that make regular classroom attendance more challenging than traditional learners, programs to ensure residents of public housing are able to access high-speed internet connections and e-learning materials may offer a path to career advancement not available to previous generations of public housing residents.

Build partnerships with private sector employers in high-skill, in-demand occupations. The demonstrated success of apprenticeship programs on both the employer and worker sides indicates their potential as a tool for addressing regional skills gaps. Workforce development programs and public sector officials offer the potential to act as brokers between qualified job seekers and employers seeking long-term employees able to advance to critical, high-skill positions.

Promote apprenticeship programs for low-income residents. While the lessons from Opportunity Chicago demonstrate the need for basic skills training for many public housing residents; workforce development programs that move participants up career ladders and into positions that allow placed workers to acquire in-demand skills through a combination of on-the-job work and classroom learning may offer the potential for residents of communities like the Near North to attain high-paying positions that would not be possible but for a workforce development program.

Prioritize workforce development as a goal of TIF. While TIF has primarily been used for capital improvements and subsidies for new housing development in the Near North, a more people-based approach to TIF spending with an emphasis on improving career skills for local residents bears stronger consideration. TIF funds earmarked for businesses that offer career development and/or funds for workforce intermediaries within TIF districts would support a people-focused approach to local and regional economic development.

Increase the recruiting presence for targeted industry sectors in communities like the Near North. While economic development professionals have identified key industry sectors to target for addressing skills gaps in the Chicago region, connecting workers to those jobs or paths that include acquiring the necessary skills to succeed in those jobs remains elusive. By working with representatives in communities with large numbers of public housing residents to promote paths to careers in target sectors, regional skills gaps can be addressed more effectively.

Consider the resurrection of an Opportunity Chicago style workforce development program that supports CHA residents. While Opportunity Chicago was created as a temporary program designed to better equip existing workforce systems for the needs of public housing residents, it was clearly successful in terms of actual job placement of residents and return on investment according to the economic impact analysis conducted for this report. A renewed program that builds on the success of the original Opportunity Chicago initiative may better enable CHA residents in the Near North to achieve better long-term career outcomes.

Existing workforce systems in Chicago are heavily invested in improving outcomes for disadvantaged workers in the Chicago region, and much of their work has resulted in improved connections between workers and employers; however Chicago’s labor market remains polarized, with those on the bottom – including many public housing residents like those in the Near North – face long odds in achieving long-term job placements in positions that offer career ladders to higher pay and greater self-sufficiency. An increased emphasis on policies that address the existing needs of this population will offer the promise of increasing the Chicago region’s economic prosperity by increasing the number of skilled workers who reside there. A people-based approach to development in tandem with the place-based approach on which much of the city’s fiscal policy has focused, warrants strong consideration from the city’s planners, economic development professionals, and public officials.

Family Size 1 2 3 4 5 6 7 8 Minimum income $25,350 $29,000 $32,600 $36,200 $39,100 $42,000 $44,900 $47,800 Maximum Income $40,550 $46,350 $52,150 $57,900 $62,550 $67,200 $71,800 $76,450 Table 3. Data Source: Chicago Housing Authority

Persons in Household Poverty Level 1 $11,880 2 16,020 3 20,160 4 24,300 5 28,440 6 32,580 7 36,730 8 40,890 Table 4. Data Source: U.S. Department of Health and Human Services

Figure 24. Data source: Bureau of Labor Statistics, (One dot = 20 jobs)

U.S. Cook LQ Export County Jobs Total employment 121,079,879 2,335,270 Agriculture, Forestry, fishing, and related 156,363 63 0.02 0 activities Mining 758,971 340 0.02 0 Utilities 637,840 5,867 0.48 0 Construction 5,705,146 64,678 0.59 0 Manufacturing 11,424,251 179,201 0.81 0 Wholesale trade 5,966,747 111,578 0.97 0 Retail trade 15,372,632 230,565 0.78 0 Transportation and warehousing 4,406,767 109,495 1.29 24,502 Information 3,364,530 72,270 1.11 7,378 Finance and insurance 6,078,713 182,350 1.56 65,110 Real estate and rental and leasing 2,021,372 42,113 1.08 3,127 Professional, scientific, and technical 8,619,574 217,854 1.31 51,608 services Management of companies and 3,235,958 83,199 1.33 20,787 enterprises Administrative and waste management 10,579,324 194,928 0.96 0 services Educational services 3,562,364 101,242 1.47 32,535 Health care and social assistance 18,861,973 368,366 1.01 4,575 Arts, entertainment, and recreation 2,170,121 37,325 0.89 0 Accommodation and food services 12,791,928 224,698 0.91 0 Other services, except public 5,347,121 108,957 1.06 5,827 administration Table 5. Data Source: U.S. Census County Business Patterns (2015)

Figure 25. Data Source: Bureau of Labor Statistics (one dot = 20 jobs)

Figure 26. Data Source: Bureau of Labor Statistics

Jobs by NAICS sector Residence Area Work Area NAICS sector 22 (Utilities) 16 0 NAICS sector 23 (Construction) 87 111 NAICS sector 31-33 (Manufacturing) 227 551 NAICS sector 42 (Wholesale Trade) 258 483 NAICS sector 44-45 (Retail Trade) 417 1,001 NAICS sector 48-49 (Transportation and Warehousing) 179 45 NAICS sector 51 (Information) 241 611 NAICS sector 52 (Finance and Insurance) 579 489 NAICS sector 53 (Real Estate and Rental and Leasing) 125 289

NAICS sector 54 (Professional, Scientific, and Technical Services) 942 2,094 NAICS sector 55 (Management of Companies and Enterprises) 144 11 NAICS sector 56 (Administrative and Support and Waste 480 1,439 Management and Remediation Services) NAICS sector 61 (Educational Services) 541 576 NAICS sector 62 (Health Care and Social Assistance) 693 501

NAICS sector 71 (Arts, Entertainment, and Recreation) 98 180

NAICS sector 72 (Accommodation and Food Services) 461 575 NAICS sector 81 (Other Services) 254 218 NAICS sector 92 (Public Administration) 136 12 Table 6. Data Source BLS LEHS

Industry % Participant Jobs Median Quarterly Earnings Health Care and Social Assistance 31% $3,319 Administrative Support, Waste Management, and 15% $3,054 Remediation Services Retail Trade 13% $2,810 Accommodation and Food Services 10% $2,439 Educational Services 6% $4,147 Public Administration 5% $3,066 Transportation and Warehousing 5% $3,495 Other Services (except Public Administration) 3% $3,195 Professional, Scientific, and Technical Services 3% $3,450 Real Estate and Rental and Leasing 2% $6,271 Table 7. Data Source: Illinois Department of Employment Security, University of Illinois-Chicago Center for Urban Economic Development

Sector Description Total Total Total Value Total Output Employment Labor Income Added 396 Medical and diagnostic labs 53.9 $3,180,980 $5,246,689 $8,648,124 and outpatient and other ambulatory care services 413 Food services and drinking 42.2 $1,179,650 $1,671,991 $3,463,058 places 400 Individual and family services 35.9 $769,561 $823,162 $1,720,917 384 Office administrative services 19.6 $1,736,321 $2,785,298 $5,799,072 392 Private junior colleges, 18.8 $1,160,823 $1,196,978 $2,312,213 colleges, universities, and professional schools 393 Other private educational 18.1 $914,439 $1,187,074 $1,706,318 services 329 Retail Stores - General 17.2 $478,859 $715,718 $1,087,594 merchandise 382 Employment services 8.1 $258,145 $258,606 $363,619 360 Real estate establishments 7.3 $293,524 $1,563,033 $2,156,931 397 Private hospitals 3.4 $253,862 $269,597 $509,005 Table 8. IMPLAN

Sector Description Event Value Employee Proprietor Compensation Income 396 Medical and diagnostic labs and $8,401,000 $2,575,905 $514,176 outpatient and other ambulatory care services 384 Office administrative services $4,125,000 $1,047,786 $187,295 329 Retail Stores - General merchandise $3,575,000 $423,871 $5,843 413 Food services and drinking places $2,750,000 $893,800 $42,955 393 Other private educational services $1,650,000 $858,054 $26,203 384 Office administrative services $1,375,000 $349,262 $62,432 400 Individual and family services $1,650,000 $689,498 $48,351 360 Real estate establishments $550,000 $38,586 $36,261 392 Private junior colleges, colleges, $2,200,000 $1,090,587 $13,900 universities, and professional schools Table 9. Data Source: IMPLAN

ADDRESS APPROVED TOTAL PROJECT DESCRIPTION AMOUNT PROJECT COST 410 W Chicago Av $5,000,000 $15,000,000 WEST CHICAGO AVENUE FIELDHOUSE 544 W Oak St $8,216,100 $41,721,331 Located in the Near North community, the project entails construction of an 8-story 112-unit rental building.The building includes 39 CHA units, 53 affordable units which are 60% or less of the area median income, 20 market rate units, one commercial space unit, and 77 parking spaces. 618 W Scott St $3,500,000 $4,000,000 Intergovernmental Agreement Between the City of Chicago and the Chicago Park District 464 W Chicago Av $3,500,000 $28,685,704 Construct 13-story 107-unit residential building including: community center and fitness center, 4130 sf retail, 59 parking spaces, Green Roof (25% roof area); 82 affordable units including: 62 (60% AMI), 15 (40% AMI), 5 (20% AMI) 846 N Kingsbury St $3,554,915 $6,513,142 Located in the Near North community, the project includes construction of 119 residential units which include 92 townhomes and 27 multi-level units. The project consists of 91 market rate for-sale units, 10 affordable for-sale units, and 18 CHA units. 1234 N Clybourn Av $1,000,000 $14,178,548 The project will construct 32,997 square feet five-story LEED certified single room occupancy (SRO) project. There will be 96 units in the SRO. 847 N Kingsbury St $4,950,972 $30,455,000 Located in the Near North community, the project includes construction of a 7-story building with 102 condos including 11 affordable units at 100% area median income and 12 CHA units. The project will also include 92 parking spaces, a green roof , and will have LEED Certification. 400 W Division St $8,737,605 $104,981,839 Located in the Near North community, the project includes construction of 2 mid-rise multi-family condominium buildings and 9 townhomes resulting in 280 residential units on an eight acre site. There are 72 CHA units, 14 below market condominiums, and 194 market rate condominiums. 1311 N Halsted St $8,600,000 $55,000,000 Located in the Near North side community, the project created 261 unit mixed-income residential housing. The first phase will include 116 rental properties; a 7-story mid-rise building (88 units), 2 six-flats (12 units), and 2 8-flats (16 units). The apartments include 38 market rate units, 39 CHA units, and 39 tax credit tenants. 442 W Division St $8,100,000 $37,920,974 Under CHA's 'Plan Forward', this proposed development will be the acquisition and new construction of a single, seven-story elevator building, that will contain 84 rental units, 76 parking spaces, and retail on the ground floor, which will include a daycare center and restaurant. 225 W Evergreen Av $410,000 $410,000 Intergovernmental Agreement with the Board of Education of the City of Chicago in order to provide up to $410,000 in Tax Increment Financing (TIF) funds from the Near North TIF for the costs associated with the replacement of all damaged lockers at Franklin Elementary Fine Arts Center 1034 N Wells St $20,000,000 $20,000,000 Construction of a three story addition to Walter Payton High School . 618 W Scott St $520,000 $520,000 $520,000 in TIF funds from the Near North TIF to pay for costs associated with the selective Enrollment High School, Site Survey Costs

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