Gov. JB Pritzker enters the House chamber for his 2025 budget address. (Capitol News Illinois file photo by Andrew Adams)
Article Summary
- JB Pritzker will propose a plan during his State of the State address to drastically limit local governments’ authority to restrict the types of structures that can be built on property zoned residential.
- Accessory dwelling units — attached or detached secondary residences such as granny flats, backyard cottages and above-garage apartments — would be legalized on all properties zoned for residential use.
- It would establish statewide timelines for inspections and reviews and allow third-party inspectors if municipalities miss deadlines.
- It includes $250 million combined for site preparation grants, middle housing development, and first-time homebuyer assistance.
This summary was written by the reporters and editors who worked on this story.
SPRINGFIELD — Gov. JB Pritzker will propose a statewide zoning law in his State of the State address on Wednesday, drastically limiting the authority local governments have to control what types of housing structures can be built on land that’s zoned residential.
Pritzker’s office says the measure will call for relaxed restrictions on the development of multi-unit housing, allowing homeowners to build “granny flats” and cutting other forms of red tape that have slowed homebuilding in recent years.
He’s also asking lawmakers to approve $250 million in capital funding for infrastructure grants aimed at knocking out “below ground costs” at sites eyed for residential development, programs to build out “middle” housing and down payment assistance for first-time homebuyers.
Middle housing describes multi-unit buildings that fall between single-family homes and larger apartment complexes. They take various forms, such as two-flats, townhomes, fourplexes and courtyard buildings.
A study published last year by the University of Illinois found that the state is about 142,000 units of housing short and would need to build 227,000 over the next five years to keep up with demand. That equals about 45,000 new homes a year — nearly double the five-year average of about 19,000 built annually between 2019 and 2024.
As a result, home prices have spiked 37% over five years while active home listings decreased 64%. At the same time, new construction permits are down 13%.
Pritzker’s plan, dubbed Building Up Illinois Developments, or BUILD, comes as Democrats in Springfield turn their focus this election year to affordability.
But unlike the last time Pritzker was on the ballot in 2022, when lawmakers approved a series of one-time tax relief measures amid sky-high inflation and surging state revenues, this proposal seeks to tackle systemic issues driving increases in the largest cost most state residents face: housing.
“All these things work together in a way that is designed to shift the narrative around whether or not Illinois is a good place to build housing,” a senior Pritzker administration official told Capitol News Illinois of the plan. “And the answer right now is ‘no,’ and we would like the answer to be ‘yes,’ and that is what we’re doing here.”
More middle housing
Pritzker’s office says the plan includes a tiered framework to permit multi-unit housing by right in all but the smallest lots zoned for residential use. Local zoning boards would no longer be allowed to prohibit property owners from building multi-unit housing on residential lots exceeding 2,500 square feet.
It would be on a sliding scale, with lots smaller than 2,500 square feet limited by right to single-unit housing. Lots between 2,500 and 5,000 square feet could hold up to four units; those between 5,000 and 7,500 square feet up to six units; and lots larger than 7,500 square feet up to eight units. The plan would also bar municipalities from requiring minimum lot sizes greater than 2,500 square feet for detached single-family homes.
However, Pritzker will need approval from the General Assembly. And the governor’s office said specific lot-size thresholds and units allowed within them will ultimately be subject to negotiations with the state legislature.
More straightforward, accessory dwelling units — attached or detached secondary residences such as granny flats, backyard cottages and above-garage apartments — would be legalized on all properties zoned for residential use. The city of Chicago moved last year to relax its 60-year ban on granny flats. And legislation was filed in Springfield last year to ban local governments from prohibiting the units. But it has not moved.
Property owners would still have to meet permitting and building inspection requirements. And local governing bodies would retain control of overall zoning classifications.
Still, the effort is likely to be met with stiff pushback from municipalities, townships and counties over its preemption of more exclusionary residential zoning requirements.
Cutting red tape
Pritzker’s office says the plan will also include yet-to-be-specified statewide timelines for housing permit reviews and inspections.
If local governments do not complete an inspection or review within a certain number of days, the applicant would be able to use a qualified third-party firm to do it. All state and local requirements would still apply.
Impact fee practices would be standardized and building codes “modernized” under the plan. And it would prohibit minimum parking requirements on middle housing and exempt affordable developments from municipal parking requirements.
Pritzker administration officials say this “patchwork of local barriers” impedes the development of housing and has driven up costs statewide, and a statewide solution is needed to spur development.
“We have municipalities that are going above and beyond now, but if it’s one out of hundreds, it’s not attracting the capital, and they’re unable to get housing built there because it’s such a piecemeal approach,” the Pritzker administration official said. “So that’s really the point of the statewide approach here.”
$250 million in funding
Pritzker is also proposing putting state money toward the effort — pulling from infrastructure-related revenue sources rather than the cash-strapped General Revenue Fund.
On the capital side, $100 million would be set aside through an Illinois Department of Commerce and Economic Development grant program for sewer, stormwater, utility and other site prep work. Pritzker officials said this infrastructure work is often difficult for developers to finance and often sinks projects before they even launch. It is modeled after a DCEO site readiness program for land eyed for industrial development.
Another $100 million through the Illinois Housing Development Authority is earmarked for middle housing development. The funds will be made available to private and nonprofit affordable housing developers.
And $50 million would be split between the existing Opening Doors program, which provides $6,000 loans for down payment and closing cost assistance to those who have historically faced institutional barriers to home ownership; and the SmartBuy program, which helps people overcome student loan debt barriers to home ownership. The programs have served 12,000 and 1,100 homebuyers, respectively, since 2020.
Housing long an issue
In 2024, an ad-hoc committee convened by Pritzker concluded in a report that the state needed to take a coordinated, multi-pronged approach to address the shortage of housing for middle-income households. Many of the proposed solutions are part of the package.
Later that year, Pritzker signed an executive order directing state agencies to explore ways Illinois could accelerate plans to expand supply and access to housing.
The proposal, both statutory changes and capital spending, will require legislative approval.
Capitol News Illinois is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.
