Daniel Kay Hertz, former Policy Director at Chicago’s Department of Housing (DOH), has an important short blog on the recent rebirth of five-story apartment construction in Chicago. The content itself is fascinating: There is strong preliminary evidence that building code reforms in Chicago have saved significant construction costs and been important to increases in recent midrise construction types affected by the reform. Everyone in YIMBY spaces should understand this specific case study. But the post is also an implicit spotlight on the nature of expertise and the possibilities for AI use by non-academic subject matter experts.
Let’s start with what Daniel found in Chicago: five-story apartments are back for the first time in double-digit annual volumes since a parking-centered downzoning in 1971, and building code liberalization is probably the biggest driver. At Chicago DOH, Daniel helped pass the Connected Communities zoning reform that relieved costly parking mandates for these and other buildings in 2022. For several years he had casually assumed that Connected Communities was the key reform that unlocked the new five-story buildings he saw around the city. But upon using Claude to compile Chicago’s permit data (instead of relying on the flawed and highly aggregated Census Building Permit Survey data), he found that five-story buildings actually spiked in 2021, a full year before Connected Communities!
Go read Daniel’s post for the answer to the mystery:
So what happened in 2021? Well, Chicago’s 2019 building code reforms went fully into effect. And Chicago’s 2019 building code reforms included a change that allowed developers to use a form of construction that had previously been capped at four stories, at five stories […]
[…] Which means that when the City allowed Type III to be used for five-story buildings in the 2019 building code, developers leapt at the opportunity.
Five-story buildings went from 100% Type I construction before the implementation of the 2019 building code to 83% Type III construction after the 2019 code allowed it. Suddenly, because Type III offered a significantly cheaper way to build, developers could afford to build five-story buildings profitably much more often, and the number of five-story developments jumped by more than 100% overnight.
Daniel had a prominent DOH legislative affairs role in passing Connected Communities, while building code reform was handled in a different city department. That could have biased his first guess at the cause of the recent five-story building boom towards the zoning reform he knew best. He now suspects building code was probably more important at this margin for these projects in these locations. But before the anti-YIMBYs crow “it’s not all zoning”1, be sure to read his whole post to see that Daniel found that zoning reform to ease costly parking mandates still did in fact help juice these projects.
Land use regulation is full of one might call gating bottlenecks (a fully-binding constraint, for which any one gating reform produces no observable housing production results until all gates are lifted) and throttling bottlenecks (partially-binding, but not wholly prohibitive of housing production). Gating bottlenecks in zoning are still the first-order problem: Where five-story buildings are simply illegal, there’s no way to even test building code changes that lower construction costs for five-story buildings. But throttling bottlenecks in building codes (like Type I materials mandates where they’re not necessary) can sometimes have larger effects on building feasibility than throttling bottlenecks in zoning (like parking mandates, at least where the mandates are expensive but not wholly prohibitive). Of course the nice thing is that lifting throttling bottlenecks has an interactive effect: Specifically, these reforms complement rather than competing with each other, and the easiest ones are worth fixing for free, or at least fixing very cheaply in terms of city staff time and capacity for implementation.
My final note on all this is the implicit upshot for AI and expertise: Daniel was thoughtfully skeptical, then intrigued, and now empowered by these new AI tools. These tools helped him evade a typical bias of human expertise (assuming the partial solution we know best is the most important single driver of that solution) by testing his hypothesis against the primary source data. He used new AI tools that give him direct and customizable access to go straight to the city’s formerly-unwieldy primary permit data to test and then revisit the hypothesis, all while ensuring the AI research assistant isn’t missing offline context that is common knowledge for a senior DOH executive and accomplished urban history author.
Manually collating the permits (tragically necessary to avoid the problems with legacy Census BPS data) is a painstaking effort. Before AI processing tools, a project like this used to carry a data cleaning and analysis workload equivalent to an undergraduate honors capstone thesis. Now that analysis can be performed under expert oversight for a quick (yet revelatory) blog very quickly. I had that very experience drafting the recent Transit-Oriented Development post on this blog: The data was all free and public, it just takes a lot of time to process it manually. Blogs aren’t peer-reviewed research, of course, and neither Daniel nor I are representing these as such. But as a serious first draft for a publishable white paper, these blogs are great examples of the future of “casual causal inference”, first-draft event studies, and simple but powerful policy-scoping analyses by expert practitioners assisted by (and adding value to) well-supervised AI tools.
To avoid these bad-faith linguistic games about whether “YIMBYs are too obsessed with zoning”--YIMBYs just use “zoning” as a shorthand for restrictive land use regulation broadly–-I’ve revived the old term “growth controls” from the 20th century anti-housing movement. Growth control regulations encompass the full stack of zoning, permitting, discretionary review, and pretextual building code requirements that are unrelated to life safety and intended only to suppress multifamily housing.