What does it take to get a building permit in Chicago?
Chicago lags behind other cities in housing affordability. The city’s permitting process could be holding it back.
Chicago has a housing crisis. Nearly 47% of Chicago households were considered “house burdened,” in 2022, meaning they pay over 30% of their income on housing costs. And over 27% of Chicago households paid over half of their income on housing in that year, making them “severely” house burdened.
A 2020 report by Chicago’s Inclusionary Housing Task Force estimated that the city has an affordable housing gap of nearly 120,000 homes.
Chicago lags behind
The key to achieving housing affordability is increasing housing supply. Unfortunately, Chicago is not doing well on this front. While the city has made progress, Chicago needs to reduce barriers to obtaining a building permit.
Waiting times between permit application and approval are often more than 80 days and minimum wait times often still exceed what other large cities impose on residents. These barriers are evident in the flagging number of permits approved in the metro area relative to other cities.
A significant contributing factor is the difficulty of getting a permit in Chicago. What goes into obtaining a building permit in Chicago? First, you must determine what kind of permit you need. Building permits are not required in Chicago for certain kinds of board-up and cleanup work, electrical work, emergency repair, stabilization work, exterior walls and other types of work.
But Chicago has separate permits for sewer service, water service, sign installation, elevator installation and building demolition among others.
The main permit for buildings requiring architectural plans is the standard plan review permit, which covers:
- New construction buildings not greater than 80 feet high
- Non-residential projects up to 150,000 square feet
- Residential projects with fewer than 50 dwelling units
- School projects up to 60,000 square feet
- Foundations and excavation not more than 12 feet deep
- Removal of non-load bearing interior partitions
Obtaining a standard plan review permit requires the following steps:
- Create application and upload plans
The architect or expeditor must create the building permit application online at the Department of Buildings website. The applicant uploads drawings and application forms to the e-plan.
2. Prescreen and plan reviews
The department reviews documents for completeness, electronic seals, building code violations and stop work orders. It then assigns the project to Plan Examiners for applicable reviews, such as architecture, ventilation, plumbing and electrical.
3. Plan corrections
Professionals of Record review plan corrections and amend the drawings. Projects with more than 3 plan review cycles require the architect of record to attend a meeting with DOB Plan Examiners.
4. Final review
First, the applicant verifies completed documents. Then, technical plan reviews are addressed by Certified Plan Corrections or approved by Plan Examiners. Finally, existing building violations are addressed and calculate permit fee balance.
And afterward come fees. The minimum fee for any Chicago building permit is $302, and the minimum fee for new residential construction is $3,450. Compare that to highest minimum fee of $290 per structure in New York City and the minimum fee of $1,500 for median-sized home in Houston. But fees are just the most visible costs of obtaining a permit. For a median-sales price home sold in April 2024, up to $14,800 of the costs incurred when applying for a building permit could be passed on to the homebuyer, based on a national survey of developers and builders conducted by the National Association of Home Buyers in 2021 and the assumptions used in the accompanying study of that survey .
Once the building plan is approved, the applicant must request the applicable field inspections for construction to begin. Most building projects also require approval from the Zoning Ordinance Administration, in addition to approval from the city Buildings Department. Whenever someone wants to change the height or use of a space, they must apply for a zoning exception or variance, adding time to the approval process.
Historically, Chicago’s permitting process, including building permits, has not been an easy one. A 2010 report by the Institute for Justice described it this way: “The line to receive approval of a permit application from the zoning department forms around 6 a.m. each day. A business owner who arrives at City Hall midday is too late.”
According to a Harvard Kennedy School of Government study, approximately 17% of zoning licenses were not being processed and sent back because of insufficient information, and over 1,300 buildings required more than three different inspections each year.
In 2019, Chicago Ald. Andre Vasquez, 40th Ward, described the burdens of trying to get a permit in the city.
“What I’ve discovered is that many parts of the city’s regulatory processes are mired in paper-only applications, in-person meetings at downtown offices (during work hours, on weekdays), and subsections of city departments with no publicly listed director or other staff contact that a constituent could reach out to with questions,” Vasquez said.
“Aldermanic prerogative,” or a customary veto given to alderman over proposed projects in their ward, represents yet another barrier to building in the city. Alleged misuse of this privilege led the Department of Housing and Urban Development to investigate the city for civil rights violations because of limits it placed on affordable housing projects in Chicago.
The effects of these barriers show in the Chicago metro area’s lagging number of permits. The Chicago metro area has seen a decrease in the number of new housing units approved since 2021, and of the 10 most populous metro areas, Chicago approved the least permits for new housing units per capita in 2023.
In fact, 19 metro areas with smaller populations approved more new housing units than the Chicago area. And while the Chicago metro area lost over 16,600 people to outmigration in 2023, other metros that lost even more people such as New York, 65,500, and Los Angeles, 71,000, saw more permits approved than the Chicago area.
Reforming Chicago’s permitting process
Chicago has some programs intended to reduce the burden on builders applying for a permit. In 2008, the city established a self-certification program allowing a certified architect or structural engineer to vouch and take responsibility for the project’s compliance with the city’s building codes.
Before then, experienced professional architects and engineers had to wait on city workers to certify the proposed building project was up to code before construction could begin. The city’s self-certification process allows for a permit to be issued within 10 business days, much quicker than it might otherwise take (as long as 87 days according to the city website as of May 24, 2024).
Chicago’s self-certification has a specific list of eligible project categories as well as a list of features that disqualify a project from the program, which includes:
- Projects increasing the number of permitted residential units
- New construction or addition of education or medical care facilities
- Work involving public venues with a capacity of more than 299
- Work involving congregate living facilities
- Work involving an ambulatory care facility
- Work involving a Wrigley Field-adjacent rooftop deck
- Work involving a distillery
- Any change of occupancy other than specific circumstances
- New construction or addition resulting in a building with area exceeding 30,000 feet
- New construction over 4 stories above grade plane
- New construction or addition of a building exceeding 55 feet.
Phoenix, Arizona modeled its own self-certification program after Chicago’s program, and public officials credit their program with helping the city achieve the housing boom the city has seen since it was introduced. But as Phoenix grew its program over the years, some clear differences have developed between the two cities’ self-certification programs, and Phoenix’s program covers more project types than Chicago’s.
Phoenix’s self-certification program for non-civil building plans applies to all plans except:
- Hazardous occupancies and projects
- New high-rise buildings more than 75’ above Fire Department access
- Projects located in a Hillside Development Area
- Extra-large assembly occupancies
- Projects in FEMA Special Floodplain Hazard Area
In addition to its self-certification program, Chicago introduced an express permit program in 2023 that replaced the previous paper-based application process with an online-based platform for applying for and monitoring the status of building permits.
Recommendations
There are a handful of areas where Chicago might be able to reduce the barriers to gaining a permit in the city.
- Find areas to expand its self-certification program to cover a broader range of projects. The city could look to Phoenix’s program for indications as to where that might be accomplished.
- Reduce the fees for new construction programs and bring them more in line with cities like New York or Houston.
- In 2019 Mayor Lori Lightfoot signed an executive order to limit aldermanic prerogative, but Mayor Brandon Johnson has not implemented her order, seemingly leaving the custom intact. Johnson should follow through on the promise of ending the practice in City Council.
Chicago has room for improvement, but other cities in Illinois can look to Chicago’s permit reforms as an example to follow. Despite the city’s decline in population and new housing approval, Chicago has fared better than most Illinois metro areas when it comes to approving new housing. In 2023, the metro area approved the second-most housing per capita in the state behind the Champaign-Urbana metro area.
While Chicago should look to cities in other states to improve its permitting process, reforms implemented in Chicago may be a good place to start for other Illinois cities looking to improve their permitting process.