The Debate Over Red Tape and Local Control For Illinois Housing

The BUILD Act and the challenge of expanding housing in Illinois

July 6, 2026  Elliot Richardson and Sam McLain

We want more people to live and work in Illinois to help our economy grow. However, our state is short 142,000 homes and will need to build 227,000 units over the next five years to keep pace with demand. The question is how to encourage development while still protecting the rights of local communities. This has been the crux of the debate over Illinois Governor JB Pritzker’s BUILD Act (Building Up Illinois Developments Act).

The BUILD Act is a key piece of Governor Pritzker’s affordability agenda. However, after several months of debate, the BUILD Act failed to pass the General Assembly. One of the BUILD Act’s most controversial proposals was to require municipalities to allow “middle housing” developments in residential zoning districts, depending on lot size. The specifics are here:

  • Lots smaller than 2,500 square feet would allow one dwelling unit.
  • Lots between 2,500 and 5,000 square feet would allow up to four dwelling units.
  • Lots between 5,000 and 7,500 square feet would allow up to six dwelling units.
  • Lots larger than 7,500 square feet would allow up to eight dwelling units.

Many areas formerly zoned for single-family homes would allow middle-density developments, such as duplexes, triplexes, stacked plexes, cottage clusters, townhouses, and courtyard housing. Municipalities would also be required to allow “granny flat” style accessory units. If municipalities failed to complete permit reviews within a designated timeline, developers could hire third-party qualified inspectors to approve projects. The bill outlined other safety standards that pre-empted county-imposed ones. In essence, this legislation restricted local municipalities’ ability to enforce certain zoning requirements.

Advocates for increased housing supported the Build Act, as did real estate development organizations. Many local governments opposed the bill. Other proposals were introduced that modified the legislation, but none gained significant momentum.

While the BUILD Act did not pass, the General Assembly did approve $250 million in capital investments, including $100 million to develop new housing projects, $100 million for the Missing Middle and Affordable Homes program, and $50 million for new and first-time home buyers. This allocation is designed to incentivize development while debate continues on how best to structure and guide additional housing construction. Governor Pritzker intends to continue conversations on housing affordability this summer.

Sam McLain is a Policy Research Intern at the SBAC and a rising senior at Northwestern University studying Philosophy and Political Science.