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State Capitol Report

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May 19, 2017

The following is a summary of action items from the State Capitol this week:

PACE BOND BILL RECEIVES UNANIMOUS VOTE IN SENATE- SENT TO GOVERNOR
On Wednesday, the Senate UNANIMOUSLY approved House Bill 2831 (Rep. Lang/Sen. McConnaughay) and this measure will now be sent to the Governor for his consideration. This bill strongly SUPPORTED by the Illinois REALTORS® was earlier approved in the House. The legislation creates the Property Assessed Clean Energy (PACE) Act to provide for this innovative financing mechanism for specified energy efficiency improvements on commercial and industrial properties. A city or county may establish a clean energy program and create a PACE area by entering into a voluntary assessment contract with the property owner to finance or refinance energy projects. The repayment of the costs of the energy project are through assessments on the property. There are a variety of safeguards in the legislation. 

In related action, the Senate amended the original companion bill, Senate Bill 1700 (McConnaughay) to add new construction as eligible and eliminate the exception for local government properties. These provisions would be allowed only if both bills were signed into law. This amendment was not part of the discussions on the original bill and the Illinois REALTORS® did not take a position on it.  SB 1700 was also approved by the full Senate and the bill has been sent to the House but no hearing date has been set. 

MOBILE HOME “RENT CONTROL” MEASURE DEFEATED ON FIRST ROLL CALL
Senate Bill 569 (Bush), the bill dealing with rent control under the Mobile Home Landlord and Tenant Rights Act, was DEFEATED in the Senate this week. However, the sponsor used a parliamentary procedure to put the measure on “Consideration Postponed” which means there could be a second vote on this controversial bill. This bill amends the Act to allow a unit of local government to enact an ordinance to prohibit park owners from increasing rent if there are pending code violations.  REALTORS® are strongly OPPOSED to any form of rent control. The Mobile Home Landlord and Tenant Rights Act provides mobile home tenants stronger protections than any other tenants in the state, includes long-term advanced notice of rent increases, and the ability of tenants to defer the payment of rent increases. We believe that this bill simply goes too far. 

REAL ESTATE LICENSE LAW CHANGES ON FINAL PASSAGE STAGE IN SENATE
The Illinois REALTORS® initiative, House Bill 3528 (Rep. Rita/Sen. Weaver), to streamline the regulation of education providers, modernize the delivery of courses, provide for more focused course material, and address issues regarding leasing agents, was moved to the order of “Third Reading” on Friday which is final passage stage.  We expect final action on this measure early next week. 

LOCAL GOVERNMENT CONSOLIDATION MEASURE APPROVED IN SENATE
Senate Bill 3 (Sen. T. Cullerton/Rep. Yingling) was one of the bills in the Senate comprehensive package of bills known as the “Grand Bargain”. This bill is a significant measure that contains a variety of local government consolidation and efficiency features. The Illinois REALTORS® STRONGLY SUPPORTS this legislation along with other measures intended to make local governments more efficient.  Included in this bill:

• Expansion of the existing Local Government Reduction and Efficiency Division within the Counties Code to cover ALL COUNTIES. Currently this applies only to DuPage, Lake and McHenry. This Division was first enacted for DuPage County in 2013.  Under the provisions, a county board would have the authority to dissolve or consolidate governmental functions. A county board could propose the dissolution of a unit of local government by ordinance.  The ordinance is required to detail the purpose and the cost savings to be achieved by the dissolution and there must be an audit of the governmental unit proposed to be dissolved. Any proposed dissolution of a unit of local government is subject to a backdoor referendum, which means that the authorizing ordinance must specify the number of voters that could petition that the question of dissolution be presented to the voters in a referendum. The chairman of the county board is also required to petition the circuit court for an order designating a trustee-in-dissolution for the unit to carry out the dissolution. All or part of the territory can be established as a special service area of the county if the county board determines that the designation is necessary to provide services. Drainage districts are exempt from dissolution provisions.

• While current law permits a county board, subject to referendum, to alter the boundaries of townships through consolidation there is a requirement that the EAV be not less than $10 million and the area is limited to 126 square miles. This bill REMOVES the existing square mile requirement to encourage consolidation. New language is added to the Township Code to set up the procedures for consolidation of any 2 or more townships- by resolution of the township boards and referendum. Transition language is included to address election issues and transfer of powers, assets, property, liabilities/obligations, etc. There also is a Section dealing with MERGERS of a single township into two other townships. Again, this is by resolution of the township board and referendum approval. 

• There is also expanded language to establish the procedure for the discontinuance of a township that is within a coterminous municipality (there are less than 20 in Illinois).

• The bill also provides a mechanism to abolish a township road district that has less than 15 miles of roads

This bill was approved in the Senate on a roll call vote of 37-6-13 and will be heard in the House Executive Committee next week. REALTOR® Representative Sam Yingling is the House sponsor.

ONE VERSION OF PROPERTY TAX CAPS EXTENSION LEGISLATON FAILS IN SENATE
Another issue on the “Grand Bargain” list is the expansion of property tax caps in Illinois to include ALL units of local government, including home rule, and to change the extension limitation to 0%. This issue has not been resolved between the caucuses and the Governor. The Senate voted on one of the proposals, Senate Bill 478 (J. Cullerton) but the bill was defeated on a roll call vote of 32-11-13. As you are aware, the EXISTING property tax cap legislation does not include home rule units and since the new proposals would include them a super majority vote (35) is needed to pass a bill. Issues that continue to be unresolved include the number of years the expansion should cover and exemptions. SB 478 had exceptions for the city of Chicago and Chicago schools, and would apply for 2 years. Another bill, Senate Bill 13 (Radogno), was not called by the sponsor.  The Illinois REALTORS® SUPPORT changes to the property tax cap law to include home rule units and to limit increases to 0% unless a higher rate is approved by the voters.     

SMOKE DETECTOR LEGISLATION ADVANCES OUT OF SENATE COMMITTEE 
The Senate Public Health Committee advanced House Bill 3773 (Rep. Willis/Sen. Sandoval) to the full Senate this week after a hearing on the bill was held. As we reported last week, after several changes to the original bill in the House, the Illinois REALTORS® removed our opposition to the measure and is now NEUTRAL. As you know, current Illinois law imposes a mandate to require owners of single and multi-family “dwelling units” built before July 1, 1988 to have operating smoke detectors in the unit. HB 3773 will require owners to replace their smoke detectors with self-contained units that have a long term battery if their existing smoke detectors are more than 10 years old and do not operate. The replacement mandate would only apply after an inspector of a pre-1988 dwelling unit finds that the smoke detector is at least 10 years old and fails to respond to an operability test. The bill also provides for a “90-day warning” to comply then an initial $100 fine for non-compliance which would be waived if the violation is corrected prior to or on the date of the hearing scheduled to adjudicate the alleged violation.   

SENATE REVENUE COMMITTEE APPROVES COUNTY RECORDER FEE SCHEDULE BILL
House Bill 3036 (Rep. Walsh/Sen. Jones) was advanced out of the Senate Revenue Committee on Monday and is currently pending in the Senate. As we have previously reported, this bill was the result of negotiations between the Illinois REALTORS®, the Illinois Association of County Clerks and Recorders and the Illinois Land Title Association.  The bill establishes a predictable fee schedule that will eliminate surcharges or fees based upon the individual attributes of documents to be recorded with the county recorder. The bill is aimed, in part, at minimizing errors in estimating and disclosing recording fees, especially given the strictures of the TRID process. The bill divides fees for standard documents into five classifications of document class flat fees, which would be inclusive of county and state fees required for each recorded document. Also included in the bill is the requirement for a cost study to be completed prior to increasing a document class flat fee to show that the increase is needed because the document class flat fees are not sufficient to cover the cost of providing the service. We SUPPORT this measure.

SCHEDULE NEXT WEEK
The House and the Senate are scheduled to return to Springfield on Monday for a full week of action.