Chicago Industrial Zoning Plan Alarms Real Estate Developers

An environmental justice push from Chicago’s mayor is raising alarms in the city’s industrial sector.

Mayor Brandon Johnson is preparing to introduce the Hazel Johnson Cumulative Impacts Ordinance next week, legislation aimed at curbing the concentration of polluting industrial uses in Black and Brown neighborhoods, Crain’s reported.

Named after a Southeast Side activist, the ordinance would mark a significant shift in how industrial developments are evaluated in the city.

The measure would require a cumulative impact study as part of developers’ applications to rezone for heavy industrial use. The studies would assess how much pollution a development would cause as well as how that would add to existing environmental burdens in neighborhoods.

Large projects would need planned development approval, while smaller ones would require special-use permits from the city’s Zoning Board of Appeals. The ordinance would also create an environmental justice advisory board to weigh in on policies and review developer-submitted impact studies. How the board would be chosen wasn’t reported.

The city’s zoning policies have been under fire since the Biden administration, when the Department of Housing and Urban Development threatened to withhold millions in grants over “discriminatory” policies disproportionately affecting minority communities in 2022. However, it’s unlikely that Scott Turner’s HUD would pursue that threat since “discriminatory” is among the words reportedly scrubbed from federal websites under the Trump administration.

Johnson has said the ordinance aims to strike a balance between job creation and community health. But industrial firms and business groups say the legislative process has lacked transparency and could chill investment in underserved areas.

The ordinance could ultimately benefit industry by introducing clear rules and a more predictable review process, CEO of the Metropolitan Planning Council Dan Lurie said. The city needs to reckon with the long-term health and environmental costs of inaction, he said.

Industry leaders say the city hasn’t collaborated meaningfully with manufacturers during the drafting process.

Mark Denzler of the Illinois Manufacturers’ Association warned that without clear permitting standards, companies may avoid investing in Chicago altogether. Others echoed concern that capital-intensive industrial projects need reliable rules that won’t shift after plans are submitted and leave them in the lurch.

The proposal is expected to be introduced at City Council next week but likely won’t get a vote until summer.

Its passage could prove difficult amid a fractured City Council, plus the mayor’s low approval ratings.

Supporters hope the measure will succeed where past efforts have failed, setting long-term zoning standards that prevent environmental harm and legal chaos, like the city’s costly fight with metal-shredder General Iron.

Then-Mayor Lori Lightfoot rescinded the company’s operating permit after constructing its Southeast Side site following its departure from Lincoln Yards. General Iron’s $100 million lawsuit with the city is still unresolved.

— Judah Duke