Raquel Garcia, her husband, and their four-year old daughter moved to Pilsen in 2012 to be closer to their jobs at local elementary schools. They were in search of an affordable place to live, but more importantly, a place they could put down roots and be surrounded by a like-minded community. “This is the first time we have stayed anywhere for more than two or three years…I had moved around the city so much growing up,” she said in an interview. “Coming to Pilsen, for the first time, I felt in community. It’s been like coming home.”

But after just a few years in the community, the couple began to notice a significant shift happening, both in their rent burden and in the community at large. As an elementary school teacher at Whittier Elementary, a neighborhood school serving families in southwestern Pilsen, Garcia began to notice that she no longer saw her students at the local laundromat, and would frequently hear about students transferring or moving out of the neighborhood. It alarmed her. “I would run into kids and ask, ‘Have you seen so-and-so?’. The answer is always, ‘Oh, they transferred’,” she said. The community Garcia had moved to Pilsen for, and fell in love with, was breaking apart.

As the shifts continued, so did the Garcias’ rent—increasing twice in two years. The Garcias moved quickly to explore their options of purchasing a home in Pilsen, as to avoid being priced out—only to find this was an impossibility for them. “We thought we had more time, and then when we started to look we realized we could not afford any of these places,” she said. In just the last five years, the average price of a 1,500 square foot home in the neighborhood rose from $126,000 to a staggering $330,000, a nearly 161 percent increase. To compare, homes in neighboring Bridgeport have only seen an increase of about fifty-one percent in the past five years.

Much of this increase can be attributed to developers coming into the community, purchasing with cash and demolishing older homes in favor of luxury housing. According to a Weekly review of city data compiled by Chicago Cityscape, in just the last three years, twelve single-family homes have been demolished and turned into new housing, raising property taxes and rents for the surrounding homes. And while groups in the neighborhood have led efforts to bring more affordable housing to the neighborhood in the form of large apartment buildings, or by attempting to convince developers to provide more affordable housing than is required by city ordinance, there are no groups seeking to save the two- and four-flats that dominate Pilsen’s housing stock, and which are a major source of rising rents and home prices, due to developers swooping in and purchasing them at a low cost.

That is, until the Pilsen Housing Cooperative—a new multi-building limited-equity housing co-op—decided to make some of its founders’ vision of creating an affordable co-op in Pilsen a reality. The project, which is still in planning stages, is currently led by a steering committee of six longtime community members, including WBEZ reporter-muralist couple Linda Lutton and Hector Duarte, fellow reporter Adriana Cardona-Maguigad, artist Gabriel Villa, web designer Carlyn So, and Amanda Cortés, an activist who grew up in the neighborhood. “We have known each other for twenty years at least. Linda and Hector wanted to do a co-op years ago, but it was a different Pilsen back then,” Villa said in an interview. “A few years back, when we had a reunion, we started to think about doing a co-op with the intention of serving long-term residents and artists that have been living here for years and are being pushed out.”

The cooperative, which targets families like the Garcias, hopes to make home ownership a possibility for those who wish to stay. “On my block a couple years ago, it was packed with children and a lot of lively families, which I enjoy,” Villa said, adding that he hopes the cooperative would draw some families who may have left back to the community.

The cooperative, known affectionately as PIHCO, will be the first limited-equity housing cooperative in Pilsen, and one of roughly thirty in the city. A limited-equity cooperative is a form of affordable housing where all members of the co-op will purchase a share, which comes with the right to occupy a unit within the co-op’s property, and agree up front to a long-term cap on the resale value of each share. The cost of each share will only increase by a set rate, not the market value—ensuring that future residents will have the ability to purchase their own shares at a cost that they can afford

PIHCO’s founders intend for their cooperative to be “scattered-site,” incorporating several buildings currently owned by community members into the project. “We want PIHCO to have as many buildings as possible in Pilsen—taking them permanently off-line for speculative developers,” their website reads. The founders see PIHCO as filling a specific and currently unmet need in the community. Some nonprofits developers focus on “building large buildings for a lot of people, but they aren’t paying attention to small houses,” Villa explained to the Weekly.

And while most owners of homes, condos, and high-end co-ops usually hope to see substantial profits from the value and equity in their homes—particularly in areas that are seeing rapid gentrification—residents of limited equity co-ops are willing to give up that profit in exchange for the benefits of stabilized housing costs and maintained residency in their communities. PIHCO organizers stress that while co-op members who are willing to sell their homes would forgo high profit margins, they would also safeguard themselves against displacement due to increased taxes. In Cook County, co-ops can receive some specific exemptions on their property values, and PIHCO founders say they hope to be taxed at the re-sale value of the property, not the market rate. Residents will be able to sell their property to PIHCO, and split the cost of owning that home with all cooperative members. The mission is to pool everyone’s resources and make stabilization a reality for everyone.

Raquel Garcia attended one of the group’s first meetings in fall 2017: a potluck dinner intended to introduce community members to the concept. She was struck at how communal and open the gathering was. “It’s very accessible. They always describe the information in a way that the wider community can understand, including complicated elements like the bylaws… There’s always translation,” she said.

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Limited equity co-ops have been around Chicago since at least the early 1960s—and housing cooperatives at large since the early twentieth century, with roots in the labor movement and the fight for housing equity. Just before the Fair Housing Act was signed into law in 1968, a group of Black Chicagoans formed the famed London Towne Houses Cooperative in Pullman—one of the first in Chicago—in an attempt to combat the discrimination against homeownership they had historically faced. JoAnn Kenner, president of the board and a resident of the cooperative since 1967, told the Tribune in April, “Even if you were able to get a mortgage, the neighborhood was not going to be welcoming. [London was like] a breath of fresh air.” Creating their own cooperative allowed residents to own their homes, and not be fearful of white neighbors forcing them out.

According to Hilary Silver, chair of the department of sociology at George Washington University, where she studies inclusive housing and homelessness, cooperatives have long been used by marginalized groups who wanted control over their homes and properties. “The idea was, let’s cooperate and we’ll cut the landlord, who [is] living off of our rents. It was like quasi-ownership. It was like creating a workers’ republic, almost. Let’s cut out the capitalists,” she told the Tribune.

PIHCO’s founders have not strayed far from this vision, explaining in a recent interview that by purchasing multiple buildings in the community, and turning them all into limited-equity buildings, they hope to directly compete with private developers, who currently have few obstacles in the neighborhood. “Residents of Pilsen who are interested in this co-op are not interested in making money [like developers],” said Garcia. “They are interested in the guarantee of a home, and a home for their children.”

Co-ops are rather sparse; according to a 2004 report from the University of Illinois at Chicago’s Voorhees Center for Neighborhood and Community Improvement and the Chicago Mutual Housing Network found that co-ops are “an underutilized and misunderstood housing option”—about 17,000 of the three million housing units in the Chicago area are co-ops, and roughly one-third of these are limited-equity, according to the report. Limited-equity cooperatives should not be confused with communes or communal living arrangements; while the purpose is to maintain existing community members, everyone owns their own unit and is responsible for their own space. Limited-equity co-ops have the explicit purpose of maintaining affordability and longevity in the community. As small as these numbers are, limited-equity co-ops have been instrumental in maintaining affordability in some communities, retaining residents who would have otherwise been priced out.

An example is the Logan Square Cooperative (LSC), where the cost of each share in its sole building has largely been frozen since 2001, and some longer-term community members have been able to stay in the neighborhood—now one of the priciest housing markets in the city. “Limited-equity co-ops help keep housing affordable in [Logan Square] by keeping prices below market value by encouraging people to think of housing not as a profit-making investment, but an investment in the community,“ wrote members Alex and Emily, who declined to provide last names, in an email. Shares sell for between $75,000 to $115,000 for apartments ranging from a studio to a three-bedroom unit; the average price for a 3-bedroom home in Logan Square sells for about $387,000, according to real estate website Trulia.

Like most limited-equity co-ops, including LSC, PIHCO is a nonprofit that will be run under a set of legal bylaws. These bylaws are the basis of the cooperative, outlining all details on how to buy into the cooperative, how ownership is transferred when an individual dies, and the voting rights of all co-op members. The cooperative is a collaborative effort by nature; as a result, it will be run by a member-run and member-selected board of directors, which will oversee new member applications, member terminations, property renovations, and handle the monthly dues. Dues will cover individual shares of operating expenses including mortgage payments, property taxes, maintenance of the building(s), insurance, and a reserve of money for emergencies and modifications. PIHCO is largely modeling their bylaws after those of LSC, with the assistance of the University of Chicago Law School’s Housing Initiative Clinic.

This type of housing initiative would be impossible without the assistance of organizations such as the Housing Initiative Clinic and, in some cases, affordable housing funding. “The [state] government can, and should, support limited-equity co-ops for low income residents in the same way they support other kinds of affordable housing,” said Jeff Leslie, director of the clinic. “By giving below-market rate loans for purchasing and renovations of the properties, low interest rates, and sometimes tax credits.” Making low rates available to limited-equity cooperatives allows them to have a considerably lower monthly mortgage payment than their surrounding neighbors, ensuring affordability in the long-term. Groups such as the clinic work with cooperatives to create legally binding paperwork including bylaws, ensuring long-term affordability. But because public funding for affordable housing, including low income co-ops, is so scarce, co-ops such as Logan Square and PIHCO look for creative ways to serve residents without relying on subsidy.

The PIHCO steering committee also intends to use their long-standing connections to the community to locate a two-, three-, or four-flat building owner who may be willing to sell their home for under market rate, or a possible foreclosure in the neighborhood. The group has continued hosting potluck dinners during which residents are encouraged to break bread, listen, and give suggestions for how PIHCO should go about acquiring its first property. “I think people are really going to step up and help,” said Villa. “This neighborhood has a whole history of creating organizations and institutions just at the moment where things are not working right. This falls so clearly within what Pilsen is about.”

PIHCO follows a long legacy of Pilsen residents fighting for community resources. “Everything we have here has been fought for. The library, the [expansion of Harrison] Park. I think with this, people are going to step up and help,” said Hector Duarte. The cooperative is a system that empowers neighborhood residents, like the Garcias, to fight back, and take hold of the community they have long invested in.

“You think you understand displacement thoughtfully, but you don’t really understand it until it happens to you,” Villa said. “PIHCO is something to use to fight. First of all, I want it to succeed, but I also want it to be seen as, ‘Look at these guys, they are just neighborhood people. They are coming together and putting their minds together and they are fighting.’”

The next informational session will be held at La Catrina Cafe, 1011 W. 18th St., on July 14 at 10am. It is open to all interested community members. pilsenhousingcoop.org

Updated 7/12/18 and 7/13/18: This story was updated to reflect minor changes regarding PIHCO’s genesis and founders, and to clarify facts regarding co-ops and their tax status.

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Bridget Newsham is a managing editor at the Weekly and is based out of Pilsen. She loves covering new and creative housing initiatives, education, and local artists. In her free time she enjoys a good swim (when it’s not too cold!), biking, and building sculptures. She last wrote for the Weekly about singer-songwriter Tatiana Hazel in April.