Legislative Session Brings Modifications to the Real Estate License Act

Illinois REALTOR® Magazine | October 2013

Legislative Session Brings

Modifications to the

Real Estate License Act

By Julie Sullivan  | Assistant Director, Legislative and Political Affairs

While the Illinois General Assembly typically overhauls most licensure statutes every ten years, the Illinois Real Estate License Act of 2000 (the Act) is often reviewed between that period. Lawmakers do that to adjust the Act to keep up with changing industry technology or to provide clarification.

During the spring session, the Illinois Association of REALTORS® introduced an initiative to make several clarifying and clean-up changes to the Act. Senate Bill 1655, sponsored by Sen. Bill Haine and Rep. Elgie Sims, Jr., was unanimously approved by the Illinois Senate and House and was signed into law by the Governor. The new law, now in effect, made several modifications:

New definitions added related to education and technology.

Two new terms were added to the definitions section of the Act.

“Electronic means of proctoring” is defined as “a methodology providing assurance that the person taking a test and completing the answers to questions is the person seeking licensure or credit for continuing education and is doing so without the aid of a third party or other device.”

“Interactive delivery method” means “delivery of a course by an instructor through a medium allowing for 2-way communication between the instructor and a student in which either can initiate or respond to questions.”

These additions will allow schools offering real estate courses and testing to use new technologies to provide more options for students.

Ability to “step down” in license category restored.

Prior to the most recent rewrite of the Act which modified the licensure categories, real estate licensees had been able to “step down” from one license category to another. However, when the Act was rewritten that provision was not included. SB 1655 restores the ability to step down and will now allow a person holding a “managing broker’s license” to exchange that license for a “broker’s license.” Managing brokers must take more continuing education than regular broker licensees, and some managing brokers have expressed a desire to step down in licensure if they are not actually acting as a managing broker. We will keep you apprised of when the “step down” process has been determined by the Illinois Department of Financial and Professional Regulation (IDFPR).

Modifications related to the automatic expiration of brokerage agreements. 

The change will allow a brokerage agreement to either have an automatic expiration provision (current law), or a provision requiring the client be notified of the right to terminate the brokerage agreement annually, by giving no more than 30 days’ prior written notice. The clarification was requested by farm property manager licensees (who often have management agreements with an annual termination/renewal option) that had been notified by IDFPR that property management agreements are considered brokerage agreements. 

REALTORS® Successfully Fight Statewide Fire Sprinkler Mandate

In June, the Illinois state fire marshal’s office proposed onerous rules that would mandate fire sprinklers in every newly constructed Illinois home and retrofits for certain multi-family buildings. IAR jumped into action and joined a coalition of local government and business groups against the rules. The effort ultimately led to victory when the fire marshal withdrew the rules on Aug. 2, 2013. 

IAR and its members attacked the issue on all fronts, reaching out to the members and staff of the Joint Committee on Administrative Rules (the legislative panel charged with the review of the rules), members of the General Assembly and the general public through an aggressive campaign that included direct lobbying and strong grassroots efforts. IAR launched an educational website (www.NoSprinklerMandate.com), surveyed Illinois residents, and did a direct mail campaign to deliver our message. IAR’s July poll, conducted by Strategic Guidance Systems, found that 89 percent of those surveyed preferred the option to make their own decision about the inclusion of a residential fire sprinkler system when constructing a new home.  

IAR stressed that homebuyers and owners could be priced out of the new home market while the home construction industry and the related businesses (i.e. real estate brokers, furniture and appliance stores, carpeting, blinds, landscaping, nurseries, etc.) would be hurt should new home construction be severely curtailed.

Retrofitting multi-family buildings — particularly high rises — even when those buildings already meet strict locally-approved safety requirements, would result in significant new costs for renters, condo owners and property owners and managers. After-construction costs to ensure that the water supply and infrastructure could handle the systems would also have fallen on the property owner.

IAR continues to fight this issue at the local level as well. IAR believes that the task of weighing the costs, risks and benefits should be done by the consumer and NOT be imposed by governmental mandates. Stay informed on all of these battles and other legislative issues at www.illinoisrealtor.org.


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October 2013

October 2013 cover

Illinois General Assembly Fall Session Calendar:
Oct. 22-24, 2013
Nov. 5-7, 2013