City Council - Regular Meeting

Council of Highland Park Committee of the Whole, May 27, 2026.

Will the clerk please call the roll?

Council Member Senter? Council Member Bruckman? Here. Council Member Ross? Here. Council Member Tapia? Present. Council Member Littleworth? Here. Council Member Bloomberg? Here. Mayor Warren?

Here. We have a quorum. May I have a motion to approve the minutes of the regular rescheduled meeting of the Committee of the Whole that was held May 11th and the minutes of the special meeting of the Committee of the Whole held on May 18, 2026. So moved. Second. All in favor say aye. Aye. Thank you. All right, scheduled business. We're going to start talking about planning and options for the redevelopment and renovation of the city's public services center and fire station 34 city manager, Newkirk.

Thank you. Thank you, mayor. Good evening, everybody. Um, we have a brief staff report in the packet this evening. That's going to guide our conversation this evening. Um, very briefly, um, we last presented to the city council at a committee of the whole meeting on March 30th. Um, and we provided an update on our work efforts, um, on the possible redevelopment of the public service center, which includes both public works and community development, as well as fire station 34. both located on Half Day Road next to each other. So the purpose of this evening is just to follow up on those questions and comments that were discussed as part of that policy discussion on the 30th. I'd like to introduce Andy Dogan, representing Williams Architect. So we've been working with Andy and the Williams team, as well as the engineering consultant, which is Gewalt Hamilton. and our construction manager, Kamosi, as well as a number of staff members that are working on this project team. And so I do want to recognize Joel Fontaine, Director of Community Development, Ron Bannon, Director of Public Works, Fire Chief Joe Schrage, Christy McAulay, our finance director, and then we have a number of other staff as well that have been part of this project. So we're going to go through the needs assessment. As a reminder, the council wanted to understand, based on the total needs for this site, how much would it cost and what does that needs assessment say for those three departments. We have been working with the consultant team and we've looked at various options for that property as well as taking into consideration other site opportunities as well. And then we've got associated costs. Um, just a couple of assumptions. This slide should look familiar to you, but these are just very important bullet points that have really served as the foundation for us moving forward. So, um, at the top fiscal stability is one of the city's top priorities. So we are moving forward and really balancing the needs of our operations, understanding what those are, with also the consideration of our total costs and how this project fits into our capital plan. We are a home rule unit of government. So basically what that means that if we do need to issue debt, we don't need to go to public referendum. We have the ability, we're not tax capped. We have the ability to issue debt and as the council knows, we've done that. for a number of different capital projects over the years most recently this year for our street program but we do have planned as part of this project the intention to issue debt for some of these project costs right now in the budget for 26 we have funds for planning and engineering doing everything as part of the planning to tell us the needs assessment and Um, what we would be recommending as part of this project. And then in fiscal year 27, as a reminder, we had budgeted as a placeholder 17.5 million. Um, just as a placeholder, not knowing what those total costs would be until we did all that planning work with our consultant team. Um, we are a triple a bond rated community. This is very important for a number of different reasons. Um, so one, when we do issue debt, we get, um, the best rate for the city of Highland park. Um, being triple aided is also a reflection of the city's sound financial planning, um, overall management of our organization, which includes every single individual in this organization. And it's also doing large credit to the mayor and city council for the sound policy that you set. Um, so that is important for us as we continue to move forward. Um, for public information, we do have a 10 year CIP. And so, um, we are looking at planning projects over a 10 year basis. And then every year though we take a look at each year as part of our budget development process and as we move forward for what is going to be in the proposed budget that we will submit to you for consideration. And when we review capital projects, the bulk of that is the responsibility of the public works director. So special appreciation to the director Bannon and the team. We have 40 million in capital projects this year, which is significant. And it's certainly an indication of the policy that the council has set, which is a focus on infrastructure investment. And our facilities is also part of that responsibility and part of that importance that we invest in our public facilities to make sure that our staff are operating most efficiently in order to best serve the public. But we prioritize capital projects on three levels. Priority one projects are what are able to be included in the budget based on funding opportunities as well as project estimated costs. And then if we're not able to include projects in the budget, we have them reflected in the capital plan, just really just so we don't lose sight of them. And again, they're reviewed on a year to year basis. We have talked quite a bit about the city's pension obligations, which are significant, and that continues to be an important area for us to make sure that our pension obligations are being met. The state statute is to be 90% funded by 2040, so we are on that trajectory right now. For public information at a recent council workshop that we had, which is kind of a kickoff to our budget process, we did talk quite a bit about the overall budget and financing plans in that regard. And in terms of use of reserves, we've done an excellent job as a city over the years building up reserves. And so when we need them, they're available to us. And we have a policy in terms of what we can use reserves for. Capital is one of those approved uses. And we have been drawing down our fund balances over the years, um, to support the investment that we are making into the community. And so, uh, that's important as we move forward, because over the years we've talked about let's use reserves, let's use reserves. We definitely have been. And so we are really at a point right now where we are using reserves to the maximum ability, just making sure that we're still in line with our policies. And then Andy's gonna walk us through the space needs assessment and at the last slide we do have a recommendation as well as the associated costs for each project consideration.

Thank you so much, City Manager Newkirk. Good evening, Mayor and Council. I'm happy to be here tonight. And I know that you have seen some numbers and some prescriptive scopes around potential components of this project. So I thought we'd take the chance this evening to really briefly back up for a second and say, what's behind this all? What is driving these recommendations and these different options? So, as Manager Newkirk mentioned, we've been working for several months now with staff on understanding the needs, understanding the existing conditions of the facilities over on half day. We've talked extensively with the fire department, with public works, with community development, both with leadership and even into a level of communication and focus groups with divisions within public works. We issued questionnaires to a number of staff members to really just make sure we were getting as much of a picture as we possibly can of the current state and what they would like to do. You see some of the common themes that we heard from staff about their current work environments. To this we would add our professional observations as architects and engineers. We also have some areas of physical conditions both in the current fire station 34 and within the public works garage of some of some needs to improve the building envelope. We see some cracking, some areas that we would expect to see in infrastructure that is pushing 50 years old. We also see some issues with accessibility and code compliance. Nothing of major concern, just things that no longer comply with today's code. So a lot of good information and I thought I'd just take a few moments to unpack what we found. In going through the needs of all of the departments, our assessment was that in total, in a perfect world, between Public Works, Fire Station 34, and Community Development, we would need almost 126,000 square feet of space. That's divided up as you see there between Public Works Community Development and Fire Station 34. One thing I want to point out because it kind of changes from slide to slide here, you'll see references to 26,000 square feet of vehicle storage. That represents just the space that the vehicles take up. What we have to add to that is space inside needed to circulate and move the vehicles around. So when you see a different number on the next slide, that explains the difference between those two. So this breaks out public works. Of that 125,006 roughly, 100,000 of that is dedicated to public works. And you can see the breakouts of the divisions here. And I think it's very clear that the need and the desire to put as many of the villages, excuse me, the city's assets inside is what's really driving that. We know when we're able to get more of a fleet and more of your equipment inside that the lifespan of all of that investment is going to be extended. And it's really predictable. Taking things inside that are outside, we usually see about a 20 to 30% extended lifespan. So there are real dollars here associated with being able to put that equipment inside. So just to break out there of what's driving all that, and again, it's probably not surprising that the majority of that program is attributable to vehicle storage and then space required to maintain the fleet you have. So this just goes into a little bit of that. Again, the 26,000 here, that's just the vehicle space itself. So that square footage that's dedicated to the garage is really that 58,000 in change there. So just wanted to show you a little bit more breakout of what's driving Public Works. Community development, we found that it's not so much quantity of space, it's quality of space that we need. Their current square footage that they're working out of over at PSC is just under 7,500, but we're really looking at spaces that serve the public better. spaces that staff are able to collaborate and just have more space and a better environment to serve the residents of Highland Park in that regard. And then Fire Station 34. We know that that fire station was built in the 70s. An interesting fact, it's a very unique design having the apparatus bay and then just that really thin connector piece over to the living area. We think we know why that was done. Underneath that connecting piece is a 20 inch water main that goes from the storage tank up to Half Day Road. So that's not something we want to put a lot of building over. So we have a feeling that that's what drove that design and just to really touch that as lightly as possible. And it also kind of drives what we can or can't do with that part of the property. One of the considerations is, is there something we can do with that current building? And I would say it's temporary space, absolutely, to facilitate the moving and the phasing of this, but as a space that we could reuse or add on to, again, that water main there, we don't know the depth of that, but even if we did, putting a brand new structure over a 20-inch water main is not a good idea. So this breaks out some of the spaces that that requires. It would become a three bay station with extra deep bays to really significantly increase the capacity at that station. And then this just gets into a comparison. Apologies for the title of the slide. This is a comparison between current state, so the gray represents the square footage that staff are currently using, and the green represents our space needs projection based on our process. So just wanted to make sure that we set the table for what we're talking about and what has gone into that before we move forward. So now we'll transition into some of the site and layouts and some of the options here. I think some things that are really important to emphasize here are that this is a very constrained site. As you can see, the city-owned property to the east, to the right, is what we would be anticipating for the new fire station simply because that footprint really doesn't fit anywhere else. But you see the rest of that current layout as it exists today. And one thing that makes this even more challenging are the flood hazard considerations around this overall site. I know this is an image you've seen before, but just to refresh your memory, all the areas in orange are basically a 500-year floodplain or a 0.2% chance of a flood event. It's not zero, but it is something, and those sorts of areas require some compensatory storage and a raising of the building floor elevation up to a level that's out of that 500-year. Fortunately, because it's 500-year, it's not a lot that we have to do. We'd probably be raising it anyway in any sort of construction. What you do get into in the teal and then the waterway are some flood waves where you see more inundation. Those are not impossible spaces to build in, but they are more expensive spaces to build in. What essentially we need to do is prove that we can remap that and pull that area out of the floodplain. So that is a time consuming process and also a costly process. But I present this and I show this because it really puts some limitations on what we can and can't easily do with the site. So we just wanted to share a few of the thoughts that we have been sharing with staff as to what could happen with the site overall. The first thing that everybody asks us and what I think is important, If I were in your shoes, I'd want to understand is if we waved a magic wand, if we made everything here brand new and addressed the needs as fully as we possibly could, what does that look like and what does that cost now? One of the interesting things about this site because of its size and because of the constraints is that we can't actually get to that 100,000 square feet of recommended space for public works. The site just simply won't accommodate that. or I should say won't accommodate it easily. There are always possibilities. It is theoretically possible to have a multi-story garage, but very expensive. So we started with this as an overall concept to discuss how we can maximize the site So we in this concept we would be replacing that two-story office block where community development and public works has their offices and shared spaces with a new larger purpose-built two-story space. We would be again demolishing the entire public service center as it exists. introducing new garage space, which is shown in gray, and new maintenance space, which are shown in that light red. And then to the east, we're showing the footprint for the new fire station. I should note that the fire station square footage that we are showing in these concepts is, again, slightly below needs assessment. We've been able to have some good conversations with Chief Schrage and his staff to work on that and pull that square footage a little bit down. So wanted to make sure I explained that discrepancy. So this really shows, it represents kind of a maximum build out of the site in terms of getting as close as we possibly can to our needs assessment. And then just one thing I would point out for reference, just immediately east, excuse me, west of the property that that you don't own where that single family residence is is where station 34 currently is eventually we would foresee that becoming parking but we certainly could use that fire station building as temporary space as this project were to happen what in whatever form it may take It gives you another asset that we're able to use to your benefit without having to figure out a temporary home or invest in temporary space. So that's one option. Again, mostly due to cost concerns, we also wanted to look at what can we do to reuse as much of what is there as we possibly can with respect to public works. So here we're saying let's still build that piece off of Half Day Road, that two-story piece brand new, but here we want to use all of that existing garage space. Make sure it's fixed up with new mechanicals. We'll take care of the building envelope. We would give the building an entirely new facade along Half Day Road. So even though you'd be working with the existing garage, it would all appear to be a new building. So you can see in the red dashed line the footprint of the existing public works garages and how we use that space. And then just have a series of additions onto that space to get as much of that public works program and as much indoor parking as we possibly can there. And then the fire station components of this particular concept is of course the same. So this is just intended not as a design, not as a direction, but just to show you some possibilities of what we can do on this site. And I think it's really, I always want to make sure I'm doing as much as I can to educate you as elected officials on what the site can handle, why we are going in the direction we're going, and to give you as many options as we can. So that will come as part of this process, but I think these are good diagrams just to show you the constraints of the site and some of the things we're able to do with it. So what does this cost? I have to preface all of this with saying that, All that the team has done to this point are those diagrams. We've worked with Kamozi Construction, who's built a lot of public works and a lot of fire station projects and a lot of village hall projects. We're actually working with them right now on two very large projects in Schaumburg, their new village hall and police station. So they are really dialed into being able to say, at this point, we can confidently predict that an all-in cost for these kinds of projects is at X dollars a square foot. So I want to emphasize that these are budget numbers. These are not based on a specific design, but rather just on square footage. And again, these are total project costs. So these include stormwater management, They include furniture, fixtures, and equipment. They include professional services. As we go down through these, the only thing that would be excluded is I go through these options. In the second option you see where if you were to look at an off-site option for community development. That would represent remodeling costs for a space large enough to house them and other related functions. It would not include the costs of acquiring or leasing such a space. But the new fire station total project budget, given the size, we're projecting at around $13.5 million right now. I should say that the next the the just the new fire station and the new off-site space for community development and then the next option that is the new fire station and just remodeled we don't love these options because they don't address the space needs for public works at all but we want to give you as much information as we can about these different permutations and what is possible from there we get into a new fire station that taking down that existing office block, replacing that with new spaces you saw, but then remodeling the garage and shops is around a $30 million project. I understand there was a question from one of you about what would it look like if We did that but didn't remodel the garage and shops. We just did the new fire station. We just did the new two-story space. That would take about $4.5 million out to $5 million out of that number. So just around $25 million. Then we have... the conceptual estimates for essentially the two concepts you just saw on the screen the second one the remodeling concept being the new fire station the new administrative space up close to half day the additions and remodeling needed to make that space as good as it can be that represents a 38 million dollar total project budget and then finally the the price tag it for entirely new Is tracking around 44Million again, these are preliminary numbers, but I know this is information that you need to make decisions about the scope of the next slide.

Just go back and maybe we could just pause right here. So, our, our recommendation this evening is this and so if we could have your feedback on that, and then any questions that you have. So. Based on the work that we've done thus far, based on the preliminary conversations that we've had with the mayor and city council, our recommendation is that we move forward with Fire Station 34. So that's a price tag of $13,500. And then we have $3 million that we know we have some engineering estimates right now for the pedestrian bridge. And so those two projects were recommending that we move forward right away with planning and engineering and kind of diving more into the details because that would take place this year with construction then to take place, you know, as early as next year, the bulk of next year. And then we will come back yet this summer because we are still working as a staff. And so we have some additional questions for the consultant team. And then we'll come back this summer with further information about a finance strategy plan to do the balance of what we want to do, how much that would cost if we postpone it so many years. We also have been looking at different funding streams as well. We talked about that at the workshop. So we'll come back later this summer with a financing strategy plan for the balance of it. But right now we're just, hopefully we'll get your green light today, move forward with the fire station and three millions for the bridge.

Yep.

Thank you.

Okay. Thank you manager. Yes. Um, unrelated to that. Um, when you were talking about the public works building and the heated garage, I know at one point when we were walking through, We talked about how not all vehicles necessarily need to be in a heated garage. They maybe need to be covered, but there are plenty of whatever, airplane hangers, whatever, that are not heated. Is there a delta that you can give us in terms of the square footage that absolutely should be in heated? And I understand that may be a little squishy.

To be honest, I want to give you a more confident number based on... and what isn't, which I need to have discussions with Ron and his crew about. So I don't want to give you an answer that may not hold up at this point.

Sounds good, because I think that obviously will impact the number if it's a shell versus a full heated garage. Thanks. And with the proposed remap of where Fire Station 34 would be sited, is there an issue with the traffic signal at that intersection with Summit?

It's something we certainly need to look into because what you see to the left, which would kind of now be the entrance in the middle of that is the signalized intersection. So we would need to look into what that means. What I can say is that this fire station is set back enough from half day. The proposed new station is set back enough where an apparatus is able to completely come out, see what's going on before they turn onto the road. So because it's set back further, it's not as much of an issue as it currently is. Chief, if you have anything else to add.

Yeah, I mean, I can add that also station 33 would not be unlike this design. Right. It's not right at light, but the light is just a little bit less of station 33. And people see the lights and hopefully they'll understand. They do, and then we also have the Opticom control to be able to stop that light and to move traffic in the right directions.

Perfect. Thank you, thank you. I just want to say thank you for looking at this in this manner, because I know when we were walking through, It was sort of how can we do things in a prioritized manner, and I think this really is responsive to what at least I was hearing from the council. Andres?

I just want you to understand, where you have the parking lot there to the left of that house, that's where the fire station is now.

That is correct, yes.

And what you were saying is we can still use that while the new one is being built on the right-hand side.

Yes. We'd have to get more into the details of phasing, Yeah, we would expect the fire station to be used the entire time that the new station is under construction. Once that is complete, there's nothing that says you need to build that parking right away. If some project were to happen with community development or public works, we'd have the ability to use that building or temporary space if needed.

Great, thank you. Do you know how long from Obviously, it can take a while, but for engineering, if we say go, how quickly can this new fire station be built?

The time from where we are today to be bid ready for a fire station will take us through the end of this year, possibly into January or February, which is actually a really great timeline to be on because we'll be able to bid things in the winter for a spring construction start, which is the best possible timeline for right now. And it's a good time to bid the project as well. Contractors tend to be hungriest for work to fill out their schedules in January and February.

And then is it a nine-month project, a 16-month project?

I'd expect the construction of the station conservatively to be about a year to 14 months.

Okay. Thanks. Annette? So could we go back to the slide where we can see more of the list of the numbers? Sure. So I asked about what it would be in terms of price if we didn't include any of the garage or heated garage or anything. So you said that's $25,000? $25,000. between so do you have either picture where you could see that where we don't have an actual garage space or I'm just trying to visualize what that would mean in terms of like the buildings are in front the two-story building Fire station is obviously all the way east, further east. And then is the rest of that just open space because it's basically parking or the shop?

Yeah, the garage space is really just open space, much like the eastern half of the garage is right now. Would we keep the current garage, I guess, is my question. In that concept, yes, we would. For now? Yes.

Right, because it could then have a different phase. But it's set back, so it's not... We would plan the siting so that you would have future space to do whatever you needed to do.

And I did want to just throw out, and I know it's kind of mixing apples and oranges, but because we know there are some other prices that are going up, or went up that 3 million, the bridge is the 2.5, but we know the costs are higher, for example, for the sidewalk on Sheridan Road. So it's just, when we're talking that 3 million, that 3 million is all spent. I just want to make sure we all understand that.

And if I may, to that point, these budget numbers do include escalation to next year for the entire project. If anything were to be delayed or any portion of the project would be delayed to the future, we'd need to look at what that would mean based on that timing.

That's part of our follow-up that we'll come back with. So, for example, if we just want to be consistent with what's in the budget right now for our 10-year CIP, so that delta in terms of basically the cost for the public service center, how much would that be estimated if we were to do it in five years? What revenue source would we use then to basically build up a capital fund? and then so what would that cost me in five years we'll also take a look in terms of if we did issue that you know pursue it now what does that look like from a tax rate perspective and from a financial perspective right now impacting other projects okay thank you other questions um i uh

With the chief here, for me, as one member of the council, the priority is the fire department getting everything it wants, and those seem like really, really key needs, getting the tour from your staff. And so is this plan with the fire station, just the fire station piece, are you getting everything you need?

Yeah, that current design, we worked with Williams to make sure that they had all of our needs and they made the assessment.

And sort of figuring out, too, projecting forward five, ten years as well.

Yeah, that was part of the reason the bays have grown, too, in comparison to what we had before. So moving to that three-bay concept and then being deeper for storage as well for other equipment, that is to meet our future needs.

we are being responsible as well so we should just caution to say getting everything you want not necessarily so let's just i think everything that they need to do their job most efficiently and to best serve the public yes and and wasn't it four base it's three days we talked about four days initially three days will suffice they'll suffice yeah yes and if they're extra deep that helps

One of the things that drove where we currently are with the fire station is simply that a four bay wide station doesn't really fit on that site with everything else that we need to do as part of the fire station program.

And then I would also ask, what if the situation with certain property changes? I know we don't anticipate it changing, but there's a cutout on the site plan.

Right. We've been in touch with that family and they have no interest in selling it. And we don't anticipate that changing, if that does change. We don't anticipate that changing. It would make it an efficient use of the space, but we have been absolutely in touch and We need to respect their response.

And I, lastly, just want to share that my approach, sort of in my mind's eye, is, again, what can we get for $25 million? What can we get for $30 million? And those, for me, are the upper numbers of what I feel is tolerable.

Insurance of next year and debt. Yeah. Okay. Thank you. Appreciate that.

Anybody else, questions, comments? Marissa? A comment. I just wanted to say thank you. I'm in favor of moving forward with the fire station. And the bridge. And the bridge. And I'm looking forward to seeing what you come back with to discuss later this summer. Great job. Thank you. Thank you. John?

Yeah. that both the fire station and public service building are critical spaces for first responders, right? And they're all super important to making the city run safely and effectively. I'll go back to comments I made at the form the other day, or whatever you want to call it, which is, you know, I know you just pointed this out, that I think having a big picture review of the CIP plan is needed, right? We've talked about a couple other projects that we need to understand that from a phasing perspective. We've got a lot of things we want to get done and a limited pool of resources and dollars to get that done. But I think as a council, we really need to think about what is critical and how we phase these decisions to get the most return on investment and what's the most critical to address today, next year, two years, or five years, 10 years from now. And along with that, financing mechanisms. to the pool of dollars that we have allocated to CIP?

So just to make it really clear, we are proud to have a 10-year CIP plan and every single year we are reviewing that 10-year capital improvement plan in an effort to make sure that we are being efficient with our dollars and also not creating waves for our taxpayers. We're trying to keep things as smooth as possible. So I think it's important to note that that is absolutely coming. I'm looking at Christie, the finance director, because once again, we are starting the budget process and that is part of that holistic approach to the 450 page budget that we put together every year. is a thoughtful approach to capital improvement. And we knew, and that's part of where these questions came up, was we had in that budget from how many years ago? 17.5 million as a placeholder. And then when we got this bottom line of way more, it was like, ooh, all right, we don't want to have any kind of disruption to our careful planning. How can we meet this critical need? And I appreciate you raising the field trip that we took to take a look at the two facilities. I thought that really kind of drove the point home of, okay, we need to do something with both. We can't do it all. How do we do this in a way that's responsible and still effective? So thanks for raising that point. I really appreciate it. And I look forward to having a good conversation moving forward. For sure.

Let me just add one thing in response to that, which is the staff does an incredible job with the budget process. And I think I fully appreciate sort of what has been done in the past from a CIP perspective. us to be a little more strategic and and not just do it in the guise of, okay, this is part of the budget process where we're checking off things that we do every year, but rather a meaningful discussion.

What is the bottom line? The bottom, bottom line. Absolutely. Under the two lines and make sure that, you know, like the bridge came up out of nowhere. And so people are like, hmm, what do we do? Where does this fall into all these other things that we've now been talking about for over 10 years in some instances. So, yeah. Thanks. Appreciate you raising that point. Tony, anything? Nope.

You're good? Annette? Just a quick thing, and I'm going to take the kind of opposite perspective of Fumi, and I hope I don't freak you out over here, John. If the face of our northern fire department changed somewhat in the next few years, and we had fewer calls because of that, Is there any way we could do this with two long bays? Because a lot of our calls come from a contract we have right now, which we've just given notice to terminate. And so while you're looking at growth, which I think is wonderful and it's much better for strategic planning, but if our overall numbers are going to really significantly for that station come down, What would be the cost and could we do it with two bays so that we could more rapidly move to some of these other phases and crucial departments too? Because I'm looking at the small tax we looked at and a way of perhaps over these next few years getting enough income to let's say take the 25 million. But if instead of spending $13.5 million on the fire station, it was more like $11 million, that's money we could use in the other areas too. So I don't mean to put you on the spot.

Chief, do you want to answer, or do you want one of us to talk about the Highwood versus Fort Sheridan? I'm happy to answer that.

Okay. So the three bays, do you want me to go up there? Please, just for the microphone.

Whatever's good for you.

The three bays versus the two bays really is not dependent on call volume. It has to do with also addressing another issue. We can't expand station 33. But as we've had to build a larger reserve fleet because of breakdowns, because of long apparatus manufacturing delays, we've been in a situation where we have to store more vehicles. So the three bays at Station 34 actually answers a shortage of space at Station 33. Call volume-wise, that station responds to 2,000 to 3,000 calls a year. If we were no longer serving Highwood, that's 7 to 800 calls. That's not a significant decrease in that station. That answers my question.

So then, yes, I'm a 13 1⁄2. I do support this as well. I guess I wanted to mention, just for the record,

pedestrian bridge didn't actually come out of nowhere. We've known it needed fixing. Oh, absolutely.

It just wasn't on the CIP.

Right, but you knew it was unfunded, but we knew that this was coming for a long time. And to reiterate what the mayor has already said, that we had a placeholder number of 17.5 million, and the number came back significantly higher than that. And so council asked for different targets. What can we get for X amount, A amount, B amount, C amount? And I just wanted to sort of explain that to anyone watching who hadn't kept up with our process. Yeah, absolutely.

I mean, we just hired Williams, you know, this year is our planning year. So we had always, we put money in the budget for actually last year and this year to do the planning with the anticipated construction that it would take place in 27. So yeah, we didn't know what the estimated cost.

But this was a response because the number was really high and we reacted to that. Sure. Yeah. Yeah.

John, are you a yes or a no on the recommendation? You're a yes? I'm okay with the recommendation. Thank you. Annette? Yes. Okay. Tony? Yes. Thank you. All right. Thank you so much for coming up with this really wise solution. And we'll move forward. And Ron, we will get to you next year. But thank you for your patience. And please tell the crew we appreciate all the input that's been provided and we'll get things figured out. And Joel. Thanks. Thank you. Thank you, everybody. All right. Our next item is a conversation around The Property Owner Association of Highland Park Housing Policy Position Paper.

Tita, are you doing this? Joel? Joel is going to present. We do have a PowerPoint that's going to guide the policy conversation. I just do want to recognize a number of our property owners are here this evening. For public information, there's a Property Owners Association for downtown, or if you're a longtime Highland Parker, Uptown Highland Park. And so the city participates in those what we call POA property owners association meetings We meet each month to talk about a variety of different projects and initiatives In order to best serve our downtown business community the businesses as well as serve as an attraction to bring people into Highland Park and so Actually it's been over a year ago that the POA compiled a position paper which is included in the packet asking for some policy considerations on the topic of our affordable housing program. And so staff did an analysis. We have information in the packet and then we're going to go through the presentation this evening. We're looking for your policy feedback in terms of next steps and any questions or feedback you'd like to provide.

Thanks. I think we also want to acknowledge Executive Director of Community Partners for Affordable Housing. Yes. Thanks for joining us. Thank you, Mayor.

Thank you. So tonight's conversation is a discussion about the Property Owners Association policy position paper regarding housing policy. Staff seeks feedback regarding housing policy matters within the position paper and we'll go through just some of the items there that are expressed in the position paper and some staff's comments with regard to them. Now staff's comments represent preliminary review of these matters. It's not an in-depth analysis on each one of the items but rather an overview type of analysis in the same spirit and depth of the position paper itself. So throughout the memo and packet we refer to the property owners association of Highland parks position paper as the paper. This was released in its form that was attached December of 2025. The paper's stated goal is to increase affordable housing in the community without stifling development. It's an important balancing act. It identifies a shortage of Highland Park's affordable housing supply as the primary concern and cites zoning requirements and inclusionary housing policy as contributing to the housing shortage here. The paper lists unintended consequences associated with the city's inclusionary housing policy and offers some recommendations for consideration. The paper kind of characterizes challenges with the current housing policies of the city related to affordable housing. It contends that there are unintended consequences, otherwise known as challenges, created from this policy. And they are reduced housing supply, rising rents and displacement, economic disequilibrium, inefficient implementation and social and economic impacts. So that's how they characterize the five major challenges of the current housing policy. The paper lists the following policy recommendations consideration on. One, increase overall housing supply. Two, preserve and enhance what are referred to in the paper as naturally occurring affordable housing. And I just want to take a second to just draw everyone's attention that there are many ways to refer to this. So NOAA is one of them. There's also below market rate housing. You'll see that in some of the research papers that were cited. And then staff refer to these as market rate affordable housing units. So those are all the same thing. Three, they talk about recommendations to introduce flexible compliance options. And four, optimize inclusionary zoning thresholds. And five, support downtown vitality through density. So those are the paper's policy recommendations just as an overall title, if you will, capturing the collection of ideas represented. Okay, so staff's comments are provided within, in line in the position paper as well as the position paper being included as its own in attachments to the memo for this item tonight. And so I will go through what staff's comments are in the most summarized form here in this presentation and be glad to talk about them further. Staff respectfully disagree with the paper's assertion that the housing supply will increase by one, decreasing on-site affordable requirements required by the city's inclusionary housing ordinance, and two, expanding buy-write payment in lieu of affordable housing on-site. You know, the credible sources cited in the paper are not applicable to Highland Park's scale and housing policy requirements, and we can explain more on that in a moment. So there were two main studies. One was the Pew Charitable Trust and the other was the UCLA study. So the Pew study examined metropolitan area housing markets. So the scale is a region, a metropolitan area, like the Chicagoland area, for instance. The USLA study analyzes the City of Los Angeles' inclusionary housing policy. Extremely low income housing requirements. And we mean by extremely low, and that's a term and a phrase that's coined by HUD, the Department of Housing and Urban Development at the federal level. is extremely low income is characterized by those households earning 30% of area median income or less. And that's AMI, area median income. So this study focused closely on that aspect of the Los Angeles policy. This is a level of affordability that the city does not require in its policy. So we just want to make sure that we understand that. And so that's why we think that while these are credible sources, they don't really pertain or are not on point with the City of Highland Park's policies specifically. So some overall comments on the paper. Staff believe that the changes to the city's inclusionary housing requirements related to the proportion of affordable and payment in lieu eligibility represent fundamental policy changes that would, one, reduce the number of affordable units provided in otherwise market rate developments, to shift affordable housing production to the city and its government and non-profit partners and three will likely result in a dearth of certain types of units more development and yield more developments of entirely affordable units and at all at a higher cost per unit OK, so reduced housing supply. So the position paper went through several challenges. And so one that was highlighted was reduced housing supply. And staff does not agree that there's been a noticeable or sharp decline in the housing production in Highland Park. The number of units in approved land developments in these two time periods, 2014 to 2019 and 2021 to 2026, are shown as follows. So 351 units with 44 inclusionary units. Those units are within the 351, so 351 total units. And then more recently, 486 units with 64 inclusionary units in that number as well. Now, we know that 2026 is not over yet and we are currently considering a planned development at the PDC that may yield additional units being added by the end of 2026 should Council approve that request. This does not show a market decline or certainly not a sharp decline. Market rate affordable supply as we talked about before, NOAA or BMR units, it fluctuates based on conditions in the broader housing market. So every five years, the State of Illinois Housing Development Agency provides a calculation of the number of units that communities have that are affordable. Per the Affordable Housing Planning and Appeals Act, And so that's referred to as the act for the purposes of this presentation. And so the act has this requirement that communities that have below 10% of their units affordable by a calculation and method that the State of Illinois Housing Development Agency applies, that they need to report into the state it's their plans for increasing affordable housing and we have done that consistently with the Act and most recently last year and so in that report or plan if you will That document is a single-purpose document to comply with this state act. It isn't essentially our complete policy, if you will, on affordable housing, which is really captured through our programmatic efforts and our inclusionary housing zoning code. And we do cite all of that in that plan, but I just want to keep that in everyone's mind's eye, because the state sets as a goal 10%. ours is a higher proportion uh 15 percent um so as to actually make headway on the 10 so let me explain you have you know thousands of dwelling units that are currently in in highland park and if you want to increase your affordable number of housing units if you only do so by 10 percent Given the fact that Tylan Park is the vast majority is already built out, you would not make much progress toward getting there. So, you know, it's useful just to look at what IDA or the Illinois Housing Development Agency has said over time. In 2014, they said Highland Park, by their calculation, and note, we did write about 10 years ago to them about some disagreement we had with the way they talk about affordable housing, and they totally discount and do not include explicitly the type of affordable housing our programs create. They have a method to calculate that they can use across all communities in the state. And that's more important to them than the particulars of a certain community like ourselves. We respectfully disagree that these represent everything that's going on and do feel like our affordable units are not fully necessarily captured here. But holding that aside, I just provide that background because I know Mayor and Councilman Bloomberg are aware of our dissent on that from about 10 years ago. Having said that, they identified 773 through their calculations in 2014. In 2018, it was 1,056. And in 2023, it was 766. And so what this shows is that market rate affordable units, NOAs or BMRs, however you want to refer to them, are created and destroyed on a very, In a very dynamic way, quite variable. And it depends on a lot of things. Some are very idiosyncratic things. Other things are market-based structural things, such as mortgage rates. It changes affordability. And that's not just for Highland Park. That's been throughout the whole nation, as the nation is reeling from an affordability crisis in housing to a greater or lesser extent, depending on which jurisdictions you're in and which states you're in. There's also idiosyncratic reasons. So what do I mean by that? Well, you know, folks own units. They may be renting them or some other means such as wanting to sell a particular home ownership product. The idiosyncratic nature of these types of affordable units is that depending on their quality and what the property owner wants to do, they position their units differently. So there are buildings that are now market rate affordable, and they might be 50 years old. And as we know, our buildings are 50 and more, and we're looking at doing what? either renovating significantly or replacing them. Well, this is what I mean by the idiosyncratic nature is that we all know that as things get older, they're going to need repair and other things like that. But where they reset themselves in the market is very important. A lot of times older units may be repositioned, meaning they'll do a gut renovation and position them at a much higher rent or for sale price. And so that's what I mean. The predictability of that is really highly dependent on individuals and organizations means and desires and strategic housing pricing choices. So that bounces around. So you can all of a sudden lose a lot of, quote, market rate affordable units just by the turnover of several buildings that happen to be more affordable because they're aged or priced at a different price point. And the new owner wants to change that. Or an existing owner says, hey, I think I should do this. I have the means to do it. And I think it's a good investment. So you can see here that quite the variability there in that what are referred to as market rate affordable units. So another one of the challenges the paper points out is rising rents and displacement. The Pew study finds that metro areas with 10% increase in housing supply experienced a marginal decline in rents. So per the Pew studies, the Highland Park would need to We need over 1,200 units developed over the seven-year period to achieve a decline in rents that they're saying that they saw at the metro area levels. That's if you assume that their metro area level marginal decline in rents is applicable to a smaller market like ourselves. So just assuming that, you need 1,200 units. So where's Highland Park in about the last six, seven years? 647. Half. OK? So it's quite a big difference there if you will say that that analysis is applicable to Highland Park, even though that's a metro area analysis, not an individual municipality analysis. I do just remind council that in 2015 the city council adopted zoning policy changes increasing density and height in and around downtown that has led in part to 791 units approved since then. Those are significant policy changes in and around downtown and they have spurred development. That number 791 isn't all just downtown in and around downtown. However, a good portion of that is. Okay, economic disequilibrium was another challenge cited in the paper. Staff contend that the city's policy is already at the paper suggested . In 2019, council may remember that there was a really in-depth look in at various aspects of the housing policy that led to some policy changes that were adopted. one of which was allowing buy right, payment in lieu for fractional units required. This was a really key change in the program. It generated revenue for the program, but that wasn't the principal reason for doing it. What led this change was the understanding that smaller developments had a higher burden, and this helped relieve some of that burden for smaller developments. So instead of having to round up for that extra unit or that partial unit requirement, you could do a payment in lieu. Payment in lieu is desirable and preferred by developers because they look at each affordable unit represents a cost to the development that has some partial offsets through what we have, what are called cost offsets in our policy. However, they nonetheless represent an opportunity cost, meaning if it's an affordable unit, you have to rent it within a certain range and you could rent it for a lot more in this market. So that's an opportunity cost that persists no matter what the other cost offsets are. And so we have seen that everybody who's had the opportunity to take advantage of a partial unit requirement payment in lieu has taken it. And so it's good in terms of revenue, but it also provides that relief in terms of the small developments. And it's applicable to all size developments. It's just more important to the smaller developments. So we did include in the attachments to this item in Council's packet a table that does look at each of the residential plan developments over time. And you can see a breakdown of the total units, the number of affordable, and the percent affordable, and which developments had a payment in lieu, et cetera. We'll talk more about that a little bit later. A fourth challenge that the paper identified was inefficient implementation. The city's inclusionary, and here the staff respectfully believe that the city's inclusionary housing program is not subjectively enforced, as was stated, but does include a discretionary element related to payment and loot considerations. Okay, so I think that's really what the paper was trying to get at, that discretionary element. Some council members may recall that during the 2019 policy conversation, there was an issue about the market rate unit bonuses that are built into the inclusionary housing zoning code. Well, it used to be that some of that bonus was discretionary, a discretionary consideration by council, whether or not it would apply. As part of the 2019 changes, all of the market rate unit bonuses are by right. So it eliminated that discretionary consideration for that aspect of things. However, what does remain is for developments that do not meet the requirements for onsite affordable, holding aside the partial requirement, partial unit requirements, which are allowed to be paid in lieu by right, For those that don't meet the affordable on-site requirement, a request to pay in lieu instead for a whole unit, this would be, not a partial one, is a discretionary consideration and remains a discretionary consideration after the 2019 policy conversation about that matter. And so that is what I believe is being referred to with regard to the position paper on that matter. The development community in general wants certainty. And the more discretionary elements of a policy there are, the less certainty there is. And so I think that's the general overarching theme. And so council in 2019 did make some aspects of the code less discretionary and more by right, but did remain and kept that aside as a discretionary element. So, you know, these payment in lieu for emitting a whole inclusionary unit, one or more, they aren't common and we do have them in the table. They have been approved by council from time to time. And so there was a time, the Albion 1 and 2, there was approved payment in lieu for some of the requirements. At that time, from staff's perspective, we did have a low fund balance, and so that's been staff's time contribution to those considerations. That's not specific in the code, but nonetheless was a situation that we did face at that time. There have been other payment-in-lieu discretionary approvals since then and have been approved as part of plan developments. um so in general you should just know that the payment in lieu monies along with demo tax monies they go to an account called the housing trust fund as you're aware and we talk about during budget season each year um those those monies are are used to create grants and to provide grants for um Scattered site housing production, what that means is scattered site housing production is a very general term, but really what it means is securing homes, buying homes, fixing them up, and making them permanently affordable throughout the community. Generally single family detached homes, but from time to time and frequently, the city has provided grant monies for For instance, the Betsy Lazar Place, eight unit townhouse development currently under construction on Deerfield. Also Hyacinth Place, maybe 15 years ago or so that was, don't quote me on that, I think it was about that long ago. So from time to time there have been those types of developments, but primarily they're purchasing and then making permanently affordable single-family detached homes. Now we do that work through SEPA. We do that work through SEPA through grants to SEPA, our housing, our land trust, if you will. And we've done that for years and it's been very productive. We also use those monies for grants for operating support for SEPA, and SEPA does a host of things for the city with regard to its affordable housing programs, including the inclusionary housing program portion, wait lists, management, income verification each year as new leases are struck and leases are changed, those are reviewed to make sure there's compliance in the program. So the scattered site program should not, however, be solely relied upon for affordable unit production, I would argue. I do think the way our programs are set up, this is like a hand in glove. We have this grant making program, And we have the Inclusionary Housing Regulatory Program. And together, they provide a portfolio of affordable units in the community through grants and then also on-site production in developments. OK, so challenge five, social and economic impacts. Staff just point out that HOA fees in developments, they frequently differ by unit. and developments, you know, throughout developments and based on various characteristics of the units independently of any inclusionary requirements. So the notion that the HOA fees vary by unit is something that is true and exists without our programs. Now, it might be to a greater degree because of the affordability that we achieved through the program, but nonetheless the differentials are there. The city's housing program strives to achieve affordability throughout the community through a combination of inclusionary housing and scattered site affordable housing. As I said, they go together hand in glove. The securing market rate affordable units NOAA's, instead of requiring inclusionary housing within developments, would not add as effectively to the housing supply of affordable units. That's our contention. When you have a development and they include inclusionary units within that development, it is a newly constructed unit. And it is permanently affordable per our program and per our zoning code. And so that is a unique opportunity. And that is distinctly different from purchasing market rate affordable units out in the market. Now, you're going to say, but Joel, we do some of that too. Yes, we do, but not at the level. What we look at is you have market rate affordable units that are performing well, and then you have market rate affordable units or homes that may be in danger of demolition or teardown. So what we do through our grant program is, first it's scattered site, we're looking for, through SEPA, throughout the community. Sometimes just catch as catch can. But if you have performing market rate affordable units, it's probably best to allow them to continue on going. A lot of the units that are identified and secured through our grant program requires some upgrade and improvement before they're turned over for a permanent affordability. And so what it does is it helps save those units from tear down. Because if you have a properly maintained functioning market rate affordable unit, it's probably in a generally safe spot in the market because there's demand. But when you have harvested units, and what I mean by that is units that may have, you know, declined because of upkeep and over time people do less with their units they become more vulnerable and so we try to try to identify those as opposed to just going after the cheapest units on the market which may be a condo in an existing older building that we could grab for cheaper than a single-family detached home that we could pay to pick up fix up and save it maybe from being demolished at some point okay so The position paper moved from challenges to policy recommendations. And so there were several of those. So there were two here, one and two, increase overall housing supply and preserve naturally occurring affordable housing. So in terms of increasing the overall housing supply, The city is going to evaluate zoning requirements like density and height as part of the comprehensive planning process. That's a standard item for any comp plan. So that certainly can be done and will be done. Recent market rate developments that require inclusionary units. are largely considered high-income developments. The City of Highland Park has a place within the housing market, so too does the broader North Shore area, and it has a particular, or is playing a particular role in that market, right? And so, yes, these are largely considered high-income developments that we see in these newer developments. So there aren't any market rate affordable units being created that are new, I could say that. Not in this community at least. Preserve and enhance naturally occurring affordable units. So, you know, one thing that we can say is that the private sector can build a unit at a lower cost per unit than the public sector can. And so you're going to say, well, why is that? Well, there's so many layers of funding that that does create extra cost and inefficiency on the public side. The private side suffers from that less, although there are layered funding sources as well. You know, SEPA does... our development arm there does struggle to secure enough NOAA's for annual standard house, standard site program. So we provide a grant and generally it's for three units and they do the best they can to find homes that are suitable for what our programmatic efforts are trying to achieve and it is hard to find them. Now, again, we're not necessarily going after the cheapest, lowest cost units that are already performing. Another thing to note is the capacity to do that. So we're talking about two to three units a year. We're talking about an eight unit town home development that takes a couple of years. So the production numbers, they're lower than what the private sector could do in developments. The planned development portion of the program through the inclusionary zoning code is able to produce a larger number of units. So the policy paper also talked about a couple of other policy recommendations, introducing flexible compliance options and optimizing inclusionary zoning thresholds. These are two very important considerations. So in terms of flexible compliance options, looking at specifically expanding the fee-in-lieu options to larger developments. It would reduce the number of inclusionary units in new developments, is our opinion. The majority of multifamily developments since 2014 are 5 to 30 units. So if you increase the number to 30 units and then, say, pay in lieu, we're going to get a lot of cash and not have a lot of ability to get units. Optimize inclusionary zoning thresholds. This goes to the percent affordable. And as we've talked about in the past, ours is about between 15 and 16%. However, as you can see in the table that's been provided, because of the payment for fractional units owed, things like that, and also discretionary payment in lieu, that percentage has been lower. We point out, as I pointed out before, that to get to the state acts 10%. If you just go ahead and do just 10%, you'll have an existing housing supply that's vastly greater than the new production. So we'll get there. Inclusionary developments in Highland Park, as shown in the table that's provided in the attachments, they're within the range of 10% to 15% affordable. on-site affordable units, okay? The code's allowance for payment in lieu for partial unit requirements can be favorable for small developments in terms of the proportion affordable on-site requirement. I mean, the example given is we just, the council just approved 734 Central, end of last year, early this year, actually 2026, technically January. And that had a percent onsite affordable of 9.1%. Now, there are some idiosyncratic When you get down into the small numbers of units, that's an 11-unit building. When you get into the small numbers, the percent affordable requirement bounces around due to rounding. So when the numbers get small, they start to mean a lot which way that happens. And importantly, the Payment in lieu for partial units becomes more important because that one part of that one unit is a higher percentage of the total units being created when you go down the scale to the smaller developments. Number five, support downtown vitality through density. Staff totally agree. I know that council does too. And we've been working on that for years. The city's adoption of zoning and building code amendments to allow increased density and height in and around downtown address this recommendation for the city's 2013 central district plan. That central district plan took several years to develop, was approved in 2013, and then the zoning aspect, the regulatory implementation of the plan occurred May 2015. So we are about 11 years out from that now. This is something that was a significant policy change in and around downtown and led to quite a bit of development that you see in those intervening years. You know, it contributed importantly to the post-2015 development of mid-rise multifamily residential buildings. What's a mid-rise building? So high-rise is at 75 feet. The building code sets that. Okay, once you go above that threshold, There are different requirements for buildings that are taller than that in terms of materials used and other types of requirements that do drive up costs quite a bit because they're much bigger buildings and there's other concerns that might be tall addressed. But below that 75 feet are mid-rise buildings. So we do allow a fair share of what could be a mid-sized building. We don't allow all mid-sized buildings because we don't allow up to 75 feet. We allow up to 63, 65 rather. Staff acknowledges that height is a persistent restricting factor that limits density. You know, the comprehensive plan update effort will consider zoning policy and potential changes in detail. And, of course, get secure community-wide input on that. But that is a limiting factor. We did increase density and height. But, you know, depending on the number of parcels you can assemble, getting the density that the zoning code allows does require a certain volume of buildings. That volume could be a wider, deeper building or taller building. So that box matters in terms of your ability to achieve the density that's otherwise allowed. Moreover, the density bonus that our inclusionary zoning code includes further needs that box to be big enough to accommodate. This was the table I was referring to. It's an attachment. It's attachment B table. For two years, table B, but it's attachment B. You can see here that these are all of the residential plan developments and inclusionary affordable housing from 2014 to 2026. So here you have the affordable onsite units in the first column after the address, total units, number of units via payment in lieu, approved fee in lieu amount, and the percent on-site units that are affordable. That's the percentage, that column, the last column on the right I draw your attention to. You can see there that We are below 15% in many circumstances as a result of the decisions and approvals that council has made regarding inclusionary housing onsite. That's the onsite number of units or percentage of units. Staff see council's feedback regarding the housing policy matters we spoke about this evening and thank you for listening. I appreciate it.

Thank you. POA and I want to thank SEPA for your partnerships because we're all working together to move this local economy forward but to also make sure that we have a diverse opportunity for members of the community to live in this city we didn't even talk Joel about the Build Act And the new Senate amendments that were added yesterday and today, I believe, and the Senate hearing that occurred yesterday. And for the council members, that's the state's legislation that's under consideration right now. because they are running through the 31st. And so it is literally, we are listening through the Metropolitan Mayor's Caucus and the Illinois Municipal League to hearings that are going on till midnight talking about this very issue. And with a lot of the legislation that's being considered, All of this will be somewhat moot to some extent because of changes and who will have the say in terms of zoning, in terms of what's being built, where it can be built, how it can be built. This is a really complex and important balance that we need to talk about and I'm proud that Highland Park since 1968 has been considered a model for other communities to look at. But we have a lot to talk about. We also need to eat dinner. So I'm going to thank you all for coming tonight. We're going to continue this conversation to our next committee of the whole, do you think, or do we have a different date? We'll confirm. We'll confirm, likely June 29th if we are. And I appreciate that you came this evening to contribute to the conversation, but we need time, and we should give it time. So if everybody's okay with that, I'm going to ask for a motion to adjourn.

So moved.

Is there a second? All in favor say aye. Aye. Any opposed? No. OK.