HUD Withholds Funds for Energy Efficiency

Federal funding delays have brought affordable housing projects across Illinois to a standstill, deepening uncertainty for developers already grappling with soaring construction costs and limited financing options.

The Green and Resilient Retrofit Program, a more than $1 billion Department of Housing and Urban Development initiative funded by the Inflation Reduction Act, has come under review by President Donald Trump’s administration, putting at least $52.5 million in grants for 15 Illinois projects in jeopardy, the Chicago Tribune reported.

Archer Courts, a 146-unit apartment building at 2242 South Princeton Avenue in Chinatown, which was set to receive $11.7 million for green energy upgrades under the program.

That work is now in limbo after HUD terminated the contract of a consultant responsible for creating redevelopment plans, said Lauren Zullo of Jonathan Rose Companies, the project’s developer.

Several other projects, including a $39.5 million renovation of Corcoran Place and the $33.9 million Austin Renaissance complex, both in Chicago’s Austin neighborhood, are also paused while developers await clarity from HUD. In some cases, work had already started, and developers are now uncertain whether they’ll be reimbursed.

A $14.5 million rehab at the Brainerd Senior Center, which had already closed on a $750,000 HUD loan, is considered more likely to receive funds, though developers say even that remains unclear.

The program’s suspension follows mounting scrutiny from the Trump administration and billionaire Elon Musk’s Department of Government Efficiency, which has also targeted HUD’s Fair Housing Initiatives Program.

Chicago-area nonprofits that previously received funding from the fair housing program had contracts abruptly terminated or left pending, including at least 14 Continuum of Care organizations waiting on more than $112 million in unreimbursed HUD grants since January.

HUD spokesperson Kasey Lovett defended the reevaluation, arguing the Biden-era emphasis on energy efficiency diverted resources from HUD’s core mission. Local officials disagree, saying the funds help preserve hundreds of affordable units while improving quality of life for residents.

At stake is more than housing stock. Developers say project delays also threaten local jobs and destabilize future rehab efforts.

— Judah Duke