What to watch: Chicago City Council to vote on granny flats, grocery tax

September 24, 2025

The Chicago City Council tomorrow is set to vote on policies that will affect families’ food budgets and housing costs.

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ILLINOIS POLICY

CONTACT: Micky Horstman (312) 607-4977

 What to watch: Chicago City Council to vote on granny flats, grocery tax

CHICAGO (Sept. 24, 2025) – The Chicago City Council tomorrow is set to vote on policies that will affect families’ food budgets and housing costs.

These ordinances include a major tax hike on groceries, as well as a pro-housing policy that lifts some barriers on granny flats, coach houses and other additional dwelling units.

Illinois Policy experts are available in Chicago to comment on the city council meeting.

Chicago could vote on ordinances that would:

  • Adopt a grocery tax: Chicago may adopt a 1% grocery tax worth up to $70 million to make up for lost revenue in 2026, when the statewide tax is eliminated. Illinois was just 1 of 13 states to have a statewide grocery tax. Since Gov. J.B. Pritzker eliminated the tax as a part of his 2024 budget, over 500 Illinois municipalities have adopted a local grocery tax.
  • Expand additional dwelling units: Legislation from Ald. Bennett Lawson to expand Chicago’s pilot program, with amendments from Ald. Marty Quinn, would allow for the construction of additional dwelling units, which include attic apartments, basement units and backyard coach houses, in multi-unit residential and commercial areas. The units have the support of 71% of Chicagoans. If the Chicago City Council went beyond this bill to further reduce restrictions, the city could create 8,000 new housing units by 2030, according to new research from the Illinois Policy Institute.
Statement from LyLena Estabine, policy researcher for Illinois Policy, on the additional dwelling unit ordinance: 
“The city made significant housing progress by eliminating parking requirements near transit stops. This ordinance to expand the additional dwelling unit pilot program, if adopted, would be another positive step. But if aldermen really want to make a difference for housing affordability in Chicago, they should go a step farther by opting-in to additional dwelling units in single-family areas. Legalizing the units citywide would offer homeowners more freedom, empowering them to invest in their own communities. It could provide additional income potential and housing options for Chicago families, particularly those in predominantly Black neighborhoods. The City Council must keep continue cutting down the government red tape that’s slowing growth and driving up costs in the city.”

Statement from Bryce Hill, director of fiscal and economic analysis for Illinois Policy, on the ordinance that would adopt a grocery tax: 
“The Chicago City Council should reject a citywide grocery tax. This would be a regressive tax on Chicago’s low- and middle-income residents, who are already struggling with inflated costs on goods and services. Instead of continuing to nickel-and-dime residents and businesses, the city should be advancing measures that permanently eliminate the city’s structural budget deficit and prioritize reducing the financial burden on Chicagoans.”

For interviews or interviews, contact media@illinoispolicy.org or (312) 607-4977.