Chicago Debates Grocery Tax, ADU Expansion

The Chicago City Council is preparing to vote on two measures with significant financial and social impact: a 1% grocery tax and an expansion of the city’s pilot program for additional dwelling units (ADUs).

The grocery tax proposal comes after Governor J.B. Pritzker removed Illinois’ statewide grocery tax in his 2024 budget. More than 500 municipalities have since implemented local versions. If approved, Chicago’s 1% tax could generate as much as $70 million annually to replace lost state-level revenue.

On housing, Alderman Bennett Lawson, with amendments from Alderman Marty Quinn, has introduced legislation to expand ADU regulations. These units—such as attic apartments, basement units, and backyard coach houses—are seen as a way to add affordable housing in multi-unit and commercial areas. A study by the Illinois Policy Institute estimates that easing restrictions further could result in the addition of up to 8,000 new housing units by 2030.

Public opinion appears to be favorable, with 71% of Chicago residents supporting the broader legalization of ADUs. Policy researcher LyLena Estabine of Illinois Policy called the ordinance a “positive step” but urged the city to go further by allowing ADUs in single-family zones.

“Legalizing the units citywide would offer homeowners more freedom, empowering them to invest in their own communities,” she said. “It could provide additional income potential and housing options for Chicago families, particularly those in predominantly Black neighborhoods.”

The City Council’s decisions will influence both local revenue and housing affordability, shaping how Chicago balances fiscal challenges with long-term community growth.