OIG performed an audit of processes related to the Downtown Affordable Housing Density Bonus. The purpose of the program is to increase the availability of affordable housing in Chicago through the provision of density bonuses that give developers additional square footage for development projects. In return, the developer provides a specified number of on-site affordable housing units or contributes to a special fund that supports the construction or rehabilitation of, or rental subsidies for, affordable housing.
The purpose of the audit was to review, test, and evaluate the processes to determine whether the Department of Housing and Economic Development and its predecessors had effective controls as well as adequate policies and procedures related to the density bonus. We determined that internal controls were not adequate to ensure a proper review of development projects prior to the issuance of building permits and the adequate training of individuals with core responsibilities respecting the collection of payments. However, we did find the internal controls ensuring the collection of density bonus payments were adequate.The deficiencies in internal controls resulted in the following negative consequences:
- Planned Development projects were not appropriately reviewed for compliance with ordinance.
- A training issue resulted in a gap in controls related to collection of payments.
There were no controls to ensure consistency in the overlapping review processes of the Department of Housing and Economic Development and the Department of Buildings and that the review process fully complied with the Zoning Ordinance.