Every three months city officials present a report to aldermen detailing their efforts to build and preserve housing for low- and moderate-income families. During the last few years they’ve been the bearers of pretty good news—through taxes and other programs, the citywide development boom yielded millions of dollars for “affordable” housing—and the council hearings were dominated by debates over who was doing a greater job of making it happen.

Needless to say, times have changed.

At the housing committee meeting Thursday aldermen still had plenty of praise for housing commissioner Ellen Sahli and her department, and committee chairman Ray Suarez still defended the Daley administration’s record even when it wasn’t being attacked. “Chicago has probably, in my opinion, the best housing plan of any city,” he said.

But the economy and housing crisis are obviously having an impact. Since the beginning of the year, Sahli said, the city has earmarked about $129 million to build affordable rental housing, $124 million for single-family homes, and another $14 million for preserving existing housing; the city anticipates that it will have set aside a  total of $378 million before the end of 2008. But that would be down significantly from last year’s total of about $661 million, according to an analysis by the nonprofit Chicago Rehab Network.

The need, of course, has gone in the other direction. Chicago had a shortage of rental housing even before people started losing their homes in staggering numbers–10,268 foreclosure filings [PDF] in 2006, 13,872 in 2007, and 13,799 this year just through just the end of October [PDF].

While some of the properties may have been resold and reoccupied by now, thousands are vacant and boarded up. Over the last several months aldermen, police, and other community leaders have been worrying aloud that the empty buildings are already pulling down neighborhood property values and contributing to crime, especially in parts of the south and west sides where the foreclosures are clustered.

Sahli told aldermen that some help is on the way from the feds: $55 million expected to arrive early in 2009 as a result of the Neighborhood Stabilization Program passed by Congress last summer. The money will go to buying and rehabbing foreclosed properties and putting them back on the market for low-income families. City officials say they’ll focus on 25 neighborhoods with the highest foreclosure and subprime mortgage numbers.

But Sahli warned that the money won’t go as far as it might sound—the value of the property foreclosed in Chicago in 2007 alone was $1.2 billion; the entire stabilization program has just $4 billion to allocate nationwide. “We have to be strategic about how we use our resources,” she said, “and magically turn $55 million into a whole lot more.”