Thursday, June 4, 2009

Illinois State Capitol Report

The Illinois House and Senate worked extremely long hours last weekend as they attempted to wrap up the 2009 spring session of the General Assembly. While much of the business DID conclude the dire financial condition of the State budget will dictate that the General Assembly reconvene later this month for further deliberations on revenue and the budget along with other issues that have not had final legislative action. This report highlights the flurry of activity that occurred up to the 1:45 a.m. adjournment on June 1, 2009. Both chambers announced that they would reconvene “at the call of the chair”.
REAL ESTATE LICENSE ACT REWRITE UPDATE
Following a series of productive meetings with Speaker Michael Madigan’s staff and our chief sponsor, Representative Kevin McCarthy, the House of Representatives overwhelmingly approved legislation on Sunday, May 31st that included the rewrite of the Real Estate License Act. Our language is now included in Senate Bill 268 which incorporates a series of measures. The bill was approved by the House Sunday evening on a roll call vote of 98-17-3 and sent back to the Senate for their concurrence. The Senate acted affirmatively to move the bill to the final passage stage but in the wee hours of June 1st the Senate adjourned with the intent of returning to Springfield later in June. The “recess” will allow the leaders of the General Assembly and the Governor to sort out the serious shortfalls in the State’s budget and the differences, not only between the parties but the chambers, on how to address the gaping budget deficit. Senator David Koehler, the chief sponsor of SB 268 in the Senate, gave us assurance that this measure would be considered when the General Assembly reconvenes later this month. It should be noted that the Real Estate License Law rewrite provisions now part of Senate Bill 268 are identical to what the Senate earlier approved as SB 1894. In addition, SB 268 also includes: Agreed language to enact limited provisions to give municipalities a priority lien for clean-up costs on abandoned property (this is language similar to the agreed language that was adopted as an amendment to HB 1195 (see below); A change to the Predatory Lending Database counseling program to add Kane, Will and Peoria counties to the program (now only applicable in Cook County). This was earlier approved in the House as HB 705. This law provides that first time homebuyers seeking loans with certain characteristics (interest only, negative amortization, points and fees in excess of 5%, prepayment penalty, ARM) must be referred to a HUD-certified counselor prior to obtaining a mortgage loan; Language requested by the community banking lobby to amend the Illinois Banking Act regarding necessary changes to ensure the continued viability of “banker’s banks” in Illinois.ILLINOIS LAND BANKING ACTAn agreement was reached in the final week of session regarding municipal liens for cleaning up abandoned property. As you’ll recall, House Bill 1195 originally granted municipalities extremely broad powers to adopt rules, regulations, and ordinances regarding “vacant and abandoned” property (which was not defined), and allowed municipalities to charge unlimited registration fees and fines regarding such properties. Following negotiations with the banking lobby, the proponents of HB 1195 (Business and Professional People for the Public Interest) worked out language that provides for a superior lien for costs of the municipality in cleaning up abandoned property, provided the municipality follows certain procedures and keeps certain records. The broad grant of authority, and the authority to impose fees and fines from the original bill, was NOT included in the compromise language. The IAR was neutral on the revised proposal, which passed the Senate, and is on concurrence in the House. As noted above, language similar to this compromise proposal was also included in the SB 268 package, which is on concurrence in the Senate. It is worth noting, since this bill originally contained the Land Banking law that IAR opposed, that the amended bill contains no references whatsoever to the establishment of land banking powers.In other action this week:LEGAL /REGULATORY/TRANSACTIONAL ISSUESFinal legislative action occurred this week as the House concurred with Senate amendments on two bills to make significant changes to Illinois law regarding electronic communication devices and cellular phones, effective January 1, 2010. House Bill 71, sponsored by Representative John D’Amico and Senator Martin Sandoval, will prohibit a person from using an electronic communication device to compose, send or read a text message while driving. The legislation has certain exceptions- such as using a device in hands free or voice-activated mode or while the vehicle is parked on a shoulder of a roadway or if the vehicle is stopped due to normal traffic being obstructed and the vehicle is either in neutral or park. House Bill 72, sponsored by Representative John D’Amico and Senator Pam Althoff, will prohibit the use of a cell phone in a school speed zone or a highway construction or maintenance zone. This new prohibition does not apply to persons working on the highway project, using a cell phone for emergency purposes, law enforcement or if using a cell phone in voice-activated mode (this latter provision added in the Senate). The IAR MONITORED these bills which have been sent to the Governor for his consideration. The House concurred with Senate action on House Bill 236 this week marking final legislative action on this bill. HB 236 changes the existing Mechanics Lien Act to require that a contractor for improvements of an owner-occupied single-family residence give the owner written notice within 10 days after recording a lien against any property of the owner. The notice is deemed served when it is sent or personally delivered. If timely notice is NOT given and, as a result, the owner suffers damages before notice is given, the lien is extinguished to the extent of the damages. The legislation stipulates that the mere recording of the lien claim is not considered damages. This new provision will not apply to subcontractors and applies to contracts entered into after the bill becomes law. IAR SUPPORTED this legislation which was sponsored by Representative Kathy Ryg and Senator Terry Link. Final action this week on Senate Bill 69, which amends the Medical Practice Act and the Optometric Practice Act regarding prohibited “fee splitting” arrangements. This bill had earlier referenced certain lease arrangements which prompted a Call to Action by the International Council of Shopping Centers but the offending language was removed and the IAR was NEUTRAL. This bill was sponsored by Senator Ira Silverstein and Representative David Miller. A duplicate bill, House Bill 496, was not advanced. Final action occurred this week on legislation creating the Community Association Manager Licensing and Disciplinary Act. Senate Bill 1579, sponsored by Senator A. J. Wilhelmi and Representative Elaine Nekritz, will require managers of community associations (condominiums, cooperatives, townhouse developments and other common interest communities) of more than 10 units to be licensed by the Illinois Department of Financial and Professional Regulation (IDFPR). Among the requirements are satisfactory completion of twenty (20) classroom hours of community association management courses and an examination. Licensed real estate brokers and salespersons are exempt from the education requirement. If signed by the Governor, the legislation becomes effective July 1, 2010. HOWEVER, the licensure requirements will NOT be enforced until 12 months after the adoption of final administrative rules for this new Act. The IAR SUPPORTED this legislation which has been the subject of negotiations for years. A duplicate bill, House Bill 271 was held and is now inactive. Final legislative action occurred this week on Senate Bill 2111, an initiative of the Land Title Association related to disbursements of funds by title companies and independent escrowees. The IAR was NEUTRAL on the bill which was sponsored by Senator Don Harmon and Representative Dan Reitz. Senate Bill 2112, also sponsored by Senator Harmon and Representative Dan Reitz, also had final legislative action this week. This bill makes various changes to the Real Estate Timeshare Act including further clarification to provisions requiring that resale agents be licensed under the Real Estate License Act. The IAR SUPPORTED this legislation which has been sent to the Governor for his consideration.HOUSING/REAL ESTATE FINANCE ISSUESThe House concurred this week with Senate amendments to House Bill 4011, sending the bill to the Governor. Sponsored in the Senate by Senator Kwame Raoul, the bill amends the Residential Mortgage License Act (RMLA) with respect to Illinois’ participation in the Nationwide Mortgage Licensing System and Registry. In short, this bill establishes a comprehensive licensing and registration system for mortgage loan originators (MLOs) within the RMLA. Much of the MLO licensing language is lifted directly from the Secure and Fair Enforcement for Mortgage Licensing Act of 2008, the federal legislation states are obligated to comply with by July 31, 2009. If a state doesn’t enact their own compliant licensing statute, HUD is charged with overseeing MLOs in that state. There are some concerns that the IAR had with some provisions of HB 4011, including the exemption language for persons performing only real estate brokerage activities in a transaction. However, the language we had concerns with was lifted verbatim from the federal legislation, and, wary of the federal mandate, the Department was reluctant to change the language, and the language remains in the bill. The Department has assured us that the issue will not be a problem upon the implementation of the program. The program has an operability date of January 1, 2011, and the IAR is planning on doing additional work on this issue prior to that date. The House concurred this week with the Senate amendments to House Bill 1142, sending the bill to the Governor for his consideration. House Bill 1142 creates the Modular Housing Buyer Protection Act to create a “state-approved” dwelling unit that must comply with applicable Illinois laws. State approved units are required to have a yellow seal displayed on either the electrical panel box or on the inside of the kitchen sink cabinet. The IAR MONITORED this legislation sponsored by Representative Mike Tryon and Senator James Clayborne. The House Judiciary I-Civil Law Committee advanced Senate Bill 177 to the House floor this week but the House did not take final action on the measure prior to the May 31, 2009 deadline and the measure is now inactive. This bill, sponsored by Senator Mattie Hunter and Representative Harry Osterman, sought to change Illinois’ Condominium Property Act related to removal of a director from a Board of Directors. The legislation stipulated that the bylaws of a condominium shall provide that any director may be removed from the Board of Directors at a special meeting of owners, called for that purpose by a two-thirds majority of those present or voting by absentee ballot. The bill also stated that all procedures governing secret ballot elections would apply. Lastly, the bill provided that a director, after notice and an opportunity for a hearing, may be suspended or removed for cause by a two-thirds majority by the Directors. The IAR was NEUTRAL. The House unanimously approved Senate Bill 1560 on Thursday, May 28th. This bill, sponsored by Senator David Koehler and Representative Jehan Gordon, provides that a deed restriction or restrictive covenant recorded after the effective date of the bill, may not prohibit or restrict the erection of an industrialized residential structure on real property. The bill further provides that a deed restriction, restrictive covenant, or agreement that applies uniformly to all homes and industrialized residential structures in a subdivision may impose the same aesthetic compatibility requirements on an industrialized residential structure in the subdivision that are applicable to all residential structures in the subdivision. The IAR was NEUTRAL on this bill that has been sent to the Governor for his consideration. No action occurred this week on Senate Bill 1933, a “shell bill” that had been sent to the House for the purpose of enacting a regulatory statute for homeowner associations. The IAR will continue to be involved in discussions on this issue, which we have conceptually SUPPORTED and have pledged to work on with both Senator A.J. Wilhelmi and House Republican Leader Tom Cross, the sponsors of the legislation, to develop a State statute.OWNER/TENANT ISSUESOn Thursday, May 28th the Illinois House overwhelmingly approved Senate Bill 1783 on a roll call vote of 102-15-0 and sent the bill back to the Senate for their concurrence. As you will recall, this is the legislation that the IAR worked on with Representatives Anthony DeLuca, Michael Zalewski, Dennis Reboletti and Senator Lou Viverito to provide an alternative to proposed legislation to permit municipalities to license and regulate landlords. The House-approved language, SUPPORTED as an alternative by the IAR, drops licensing altogether and instead would permit municipalities to enact a requirement that any lease for single or multi-family residential property include a provision or an addendum that prohibits criminal activity and provides the landlord the right to terminate the lease when the tenant(s) engage in such activity. The House version also includes an amendment to Section 9-120 provisions of Code of Civil Procedure to reduce some of the notice procedures when evicting a person for engaging in criminal activity. The original Senate sponsor, Senator Mike Jacobs, objected to the House amendments which had gutted his original bill and he filed the motion to non-concur with the language which has stalled the bill. Senator Lou Viverito has taken over Senate sponsorship of the bill. It is unclear what will be the ultimate fate of this legislation but the IAR will continue to monitor any further action on the issue and keep you informed. House Bill 621 has been sent to the Governor after both the House and Senate unanimously approved the legislation. HB 621, sponsored by Representative Mike Fortner and Senator Randy Hultgren, would permit a Township Board to also provide for the cutting of grass, the trimming of trees or bushes and the removal of nuisance bushes or trees in addition to their current authority for the cutting of weeds. This nuisance language is similar to the law approved in 2007 for municipalities. The IAR was NEUTRAL. Following extensive revisions from its introduced version, Senate Bill 1920 has been approved by both the Senate and the House. In its final form, SB 1920 amends the Mobile Home Landlord and Tenant Rights Act to create a Mobile Home and Manufactured Home Relocation Commission. The purpose of the Commission is to study the process and procedure by which a mobile/manufactured home located in a mobile/manufactured home park that is closing is relocated. The Commission is to be made up of 10 members and the legislation specifies the duties of the Commission and directs that a report be provided to the General Assembly on or before January 1, 2010. The IAR was NEUTRAL on this legislation sponsored by Senator Susan Garrett and Representative Bob Flider.ENVIRONMENTAL/HEALTH AND SAFETY ISSUESFinal action this week on legislation related to surface discharging private sewage disposal systems. House Bill 170, sponsored by Representative Michael Tryon and Senator Susan Garrett prohibits the construction or installation of a surface discharging private sewage disposal system by any person unless that person has a coverage letter under a National Pollutant Discharge Elimination System (NPDES) permit issued by the IEPA or the local public health department has a general NPDES permit issued by the IEPA and the system is covered under that permit. The sponsors purposely delayed the effective date of this bill until January 1, 2013 to give the IEPA the time to develop rules and regulations related to this issue. The IAR was NEUTRAL on the final version of this legislation. House Bill 3987, sponsored by Representative Julie Hamos and Senator Don Harmon, has been approved by both chambers after extensive negotiation over the past two sessions. The bill modifies the existing Energy Efficient Commercial Building Act (first enacted in 2004) to expand the Act to cover both commercial and residential buildings with certain exemptions. Additions, alterations, renovations or repairs to an existing building, building system or portion thereof shall comply with the Code but the unaltered portion is NOT required to comply. The legislation specifies if the energy use of the building is not increased the Code will not apply to storm windows installed over existing fenestration, glass only replacements in an existing sash and frame, existing ceiling, wall or floor cavities exposed during construction, (provided the cavities are filled with insulation) and construction where the existing roof, wall or floor is not exposed. The bill also provides that if a local government does NOT regulate energy efficient building standards that they are not required to adopt, enforce or administer the Code but if they later adopt such standards they must then comply with the Act. In those municipalities, this Act’s standards will apply to construction, renovations or additions. While the bill provides that no unit of local government may regulate energy efficient building standards for residential buildings in a manner that is LESS or MORE stringent than the standards established in this Act it does recognize and spell out specific exceptions due to existing local Codes. These include the city of Chicago; any unit of local government that has on or before May 15, 2009 adopted or incorporated by reference energy efficient building standards for residential buildings that are equivalent to or more stringent as the 2006 International Energy Conservation Code; a unit of local government that has, on or before May 15, 2009 provided to the Capital Development Board an identification of an energy efficient building code or amendment that is equivalent to or more stringent than the 2006 International Energy Conservation Code. NO unit of local government can enact any annexation ordinance or resolution or require an annexation agreement that imposes standards for residential buildings less or more stringent than the energy efficiency standards in effect at the time of construction in that unit of local government. The IAR was NEUTRAL on the bill in its final form. Legislation has been approved in both the Senate and the House to make changes to the Elevator Safety and Regulation Act. Senate Bill 149, sponsored by Senator Don Harmon and Representative Sandra Pihos, makes various changes to the Elevator Safety and Regulation Act including adding a reference to a local administrator of the Act. This is specifically done to allow a municipality or county to enter into an agreement with the Administrator (the Office of the State Fire Marshal) to operate their own elevator safety program. The bill also amends the make-up of the Elevator Safety Review Board to include a representative of an advocacy group for condominium owners. The Review Board is also specifically charged with making binding determinations regarding variances, interpretations and the installation of new technology. Certain upgrade requirements of the Act are also extended out to January 1, 2015. The IAR MONITORED this legislation. Senate Bill 1489 has been approved by both the Senate and House and will be sent to the Governor for his consideration. This bill, sponsored by Senator Iris Martinez and Representative Elaine Nekritz, creates the Green Infrastructure for Clean Water Act. The bill directs the Illinois EPA, in conjunction with the Department of Natural Resources, the Department of Transportation and the Capital Development Board, stormwater management agencies and other interested parties, to submit a report to the General Assembly and Governor on stormwater including green infrastructure use and benefits. Also to be contemplated is the feasibility of devoting 20% of the Water Revolving Fund to green infrastructure, water and energy efficiency and other “environmentally innovative activities” on a long-term basis. The IAR was NEUTRAL on this issue. A comprehensive measure amending the Public Utilities Act was approved this spring session after months of negotiation. Senate Bill 1918, sponsored by Senator Kim Lightford and Representative Bob Flider, includes provisions requiring electric utilities to establish an “on-bill financing” program for energy efficiency measures for eligible customers. An electric utility that serves more than 100,000 customers on January 1, 2009 will be required to offer an approved on-bill financing program to allow retail customers who own a residential single family home, duplex, or other residential building with 4 or less units or a condominium to borrow funds from a third party lender to purchase approved electric energy efficiency measures for installation in such home or condo without any upfront payment and to pay back such funds over time on their bill. A loan issued to a participant is the sole responsibility of the participant and the bill requires that any dispute that may arise of the loan’s terms, conditions or charges must be resolved between the participant and the lender. Importantly, the legislation includes language that provides that upon transfer of the property title for the premises at which the participant receives electric service the participant must pay in full its electric utility bill, including all amounts due under the program. The IAR participated in meetings on this legislation and was NEUTRAL on the final bill. The General Assembly adopted Senate Joint Resolution 36 this spring related to the impending capital public works program. Among the provisions of SJR 36 is the resolution that the General Assembly and the Governor should make passage of a green and sustainable comprehensive capital construction plan a top priority and that environmental health/protection and energy efficiency and sustainability ought to guide the allocation of all funds in any capital construction plan. Further SJR 36 resolves that the law require builders to adhere to sustainable building standards- including LEED standards, the Green Globes standards or construction elements with an equivalent certification. The Resolution also resolves that the State should give due consideration to new public transportation (including rail) in the interest of planning sustainable transportation and that in providing for the construction or improvement of roads that the State should prioritize the laying of fiber-optic lines. Resolutions do not have a binding effect as would a Senate or House bill. This resolution, sponsored by Senator Heather Steans and Representative Karen May, was adopted by both chambers.LAND USE/DEVELOPMENT/LOCAL GOVERNMENT ISSUESThe Senate concurred with a House amendment to Senate Bill 138, marking final action on this legislation establishing a State minimum building code for newly constructed commercial buildings in local jurisdictions that do not have an adopted minimum building code. The bill provides that after July 1, 2011 newly constructed commercial buildings in “non-building code jurisdictions” must have an inspection by a qualified inspector prior to being occupied. These inspectors must either be qualified by the State, certified by a nationally recognized building official certification organization or have filed verification of inspection experience with the State’s Capital Development Board and can also include an individual qualified by an apprentice program certified by the Bureau of Apprentice Training. This qualification requirement does not apply to local building enforcement personnel if they have registered its adopted building code with the Illinois Capital Development Board. Local governments can also establish agreements with other governmental entities to issue permits and enforce building codes and to hire third-party providers to do the inspections. The bill defines commercial building, newly constructed commercial building and specifically exempts new residential construction. This issue has been the subject of negotiations for a few years and the IAR was NEUTRAL on the negotiated proposal. The General Assembly overwhelmingly approved legislation to strengthen Illinois’ Freedom of Information Act. Senate Bill 189, sponsored by Senator Kwame Raoul and Speaker Michael Madigan contains a number of provisions including a narrowing of the number of exemptions that has allowed the withholding of otherwise public information. In addition, the legislation seeks to enhance enforcement of the Act by adding “public access counselors” and penalties for noncompliance. The bill has been sent to the Governor for his consideration. The Senate concurred this week to two House amendments to Senate Bill 414, marking final action on this legislation. Senate Bill 414, sponsored by Senator Kwame Raoul and House Majority Leader Barbara Flynn Currie, was an initiative of the Center for Neighborhood Technology. As approved, the bill directs the Department of Commerce and Economic Opportunity, the Department of Transportation and the Illinois Housing Development Authority to adopt the Housing and Transportation Affordability Index (or a substantially equivalent affordability measure) as a planning tool and for consideration for allocating funds, distributing economic incentives and siting public facilities. The legislation directs the Task Force, created under the Comprehensive Housing Planning Act, and the Interagency Coordinating Committee on Transportation to consider the Affordability Index and other measures to “create an affordability definition and policy that incorporates housing and transportation costs for Metropolitan Planning Organization Areas” and shall include both in the Annual Comprehensive Housing Plan for MPO areas. This legislation also creates the Illinois Transportation Policy Committee under the Department of Transportation Law to advise on the State’s five-year transportation plan. Each MPO is also directed to develop a regional transportation plan that shall include specified elements. Public involvement and accountability are also highlights of this legislation. The IAR was NEUTRAL on this legislation. The Senate concurred this week with the House amendment to Senate Bill 587 that added language OPPOSED by the IAR. This concurrence marked final legislative action on this measure. SB 587, sponsored by Senator Michael Frerichs and Representative Bill Black, grants counties with less than 100,000 in population that have a public building commission organized by the county seat the power to have post-secondary student housing built and maintained. The legislation was initiated for the Danville Community College. The intent is for the College to deed land to Vermilion County who will lease the housing facilities constructed by the Danville Public Building Commission. The IAR testified in OPPOSITION to this new county power, expressing the concern over this significant new power for counties granted without any input from the county’s property taxpayers. Particularly of concern since the property taxpayers will be required to pay annual property taxes for the lease of the student facilities- which will be levied without referendum. It should also be noted that Illinois law specifically denies community colleges the authority to construct dormitories or staff housing. Both chambers have taken final action on legislation to grant limited quick-take eminent domain powers to the village of Johnsburg (located in McHenry County). Senate Bill 1296, sponsored by Senator Pam Althoff and Representative Mike Tryon, authorizes the use of this power for no more than one year for two parcels for the purpose of constructing a METRA rail station and rail storage yard. The IAR was NEUTRAL. Senate Bill 1511, sponsored by Senator David Koehler and Representative Jehan Gordon, has been approved by both the Senate and the House. The bill will clarify that a county board is permitted to require that an occupancy permit be obtained for newly constructed residential dwellings outside the corporate limits of a municipality. If a county enacts this provision after the effective date of this bill they will NOT be permitted to impose a fee for the permit. Fees currently imposed are grandfathered. The IAR was NEUTRAL on this legislation initiated by Peoria County. Final legislation action this week on Senate Bill 1784, sponsored by Senator Mike Jacobs and Representative Jim Sacia. This bill creates a new Act- the Upper Mississippi River International Port District Act- a new economic development tool for the Carroll and Jo Daviess County area. This will allow the development of channels, harbors, river ports and port-related facilities and services, airports, airfields and terminals. While the legislation grants eminent domain powers any such power must be exercised in accordance with the Eminent Domain Act. The IAR was NEUTRAL on this measure which has been sent to the Governor for his consideration. Senate Bill 1909, sponsored by Senate Majority Leader James Clayborne and Representative Tom Holbrook, received final legislative approval in the early hours of June 1st. This legislation, known as the STAR Bonds Financing Act, is based on a development incentive used in Kansas City. The legislation allows the use of both State and local sales tax revenue collected in the development to be used to pay off the STAR (Sales TAx Revenue) bonds. The estimated $1.5 billion development is targeted for property in Glen Carbon, Illinois. The proponents indicated that the project would create 10,000 construction jobs and over 3,000 permanent jobs. The IAR was NEUTRAL.TAX ISSUES/STATE BUDGETThe Senate, in a close roll call vote taken on May 30th, approved a significant revenue proposal that sought to address both the shortfalls in the overall State budget and education funding (31-27-1). House Bill 174, co-sponsored by Senate President John Cullerton and Senator James Meeks, would enact a permanent income tax increase. The proposal would raise the individual rate from the current 3% to 5% (a 67% increase) and the corporate tax rate from 4.8% to 5%. This proposal also included an expansion of the sales tax base to cover specific services. The legislation used the service categories from the 1997 North American Industry Classification System Manual (prepared by the US OMB) would include the following services:-Other warehousing and storage (household and specialty goods)-Travel agent services-Carpet and upholstery cleaning services-Dating services-Dry cleaning and laundry, except coin-operated-Laundry and dry cleaning, coin-operated-Consumer goods rental-Health clubs, tanning parlors, reducing salons-Linen supply-Interior design services-Other business services, including copy shops-Bowling centers-Coin operated video games and pinball machines-Memberships in private clubs-Admission to spectator sports (excluding horse tracks)-Admission to cultural events-Billiard parlors-Scenic and sightseeing transportation-Taxi and Limo services-Unscheduled chartered passenger air transportation-Motion picture theaters, except drive-in theaters-Pet grooming-Landscaping services (including lawn care)-Income from intrastate transportation of persons-Mini-storage-Household goods storage-Cold storage-Marina Service (docking, storage, cleaning, repair)-Marine towing service (including tugboats)-Gift and package wrapping service-Other services to buildings and dwellings-Water softening and conditioning-Internet Service Providers-Short term auto rental-Information services-Amusement park admission and rides-Circuses and fairs- admission and games-Cable and other program distribution -Rental of video tapes for home viewingThe House never called this proposal for a vote- opting to vote on a different income tax proposal promoted by Governor Quinn. This bill, Senate Bill 2252, would enact a two year temporary increase in both the individual rate (3% to 4.5%) and the corporate rate (4.8% to 7.2%). This bill did NOT include the sales tax expansion on services- which is very controversial in the House. This measure FAILED on a roll call vote of 42-74-2.Late in the session both chambers voted to authorize, once again, a sweep of various dedicated funds. The Senate concurred with the House and voted to authorize the sweep of over $356 million from dedicated funds, including $1,081,000 from the Real Estate Research and Education Fund and $1,200 from the Real Estate Audit Fund. There were NO funds taken from the Real Estate License Administration Fund. In all likelihood this is due to the fact that the IAR filed a lawsuit in Sangamon County in 2006 challenging the constitutionality of such a sweep of the Real Estate License Administration Fund (RELAF). The State of Illinois entered into a stipulation in that case that precludes the State from transferring any funds from the RELAF to be used for any purpose other than those specified in the Real Estate License Act without giving IAR 21 days notice and an opportunity for the underlying case to be heard by the court. House Bill 441, sponsored by Representative Chuck Jefferson and Senator Dave Syverson, was approved by the Senate this week marking final legislative action. This bill amends the Industrial Jobs Recovery Law in the Illinois Municipal Code to allow a redevelopment area in Rockford to be extended for an additional five years. The bill has been sent to the Governor for his consideration. The IAR was NEUTRAL on this bill. The House concurred with the Senate version of House Bill 2394 this week marking final legislative action. HB 2394, sponsored by Representative Mark Walker and Senator Dan Kotowski, amends the TIF law to specify that a redevelopment project area may include areas within ½ mile radius of an existing or proposed RTA Suburban Transit Access Route station without a finding that the area is classified as an industrial park conservation area, a conservation area or a blighted area. However, the municipality must receive the unanimous consent of the TIF joint review board. The redevelopment project costs are specifically limited to the costs related to the existing or proposed station. The IAR was NEUTRAL on this measure which has been sent to the Governor. The House also concurred this week to the Senate amendment to House Bill 4120. House Bill 4120, sponsored by Representative Mark Walker and Senator Dan Kotowski, will allow any taxing district, upon a majority vote of its governing body, to abate any portion of property taxes if a new business first occupies a facility located on the property during the taxable year and the facility was vacant for a period of at least 24 continuous months prior to being occupied by the business. The Senate had modified the original bill to provide that the abatement cannot exceed a TWO-year period (as introduced it was five) and the aggregate amount of abated taxes for all taxing districts cannot exceed $4 million. The IAR SUPPORTS this legislation which has been sent to the Governor. The Senate concurred this week to a House amendment on Senate Bill 1553, marking final legislative action on this bill. Senate Bill 1553, sponsored by Senator Dan Rutherford and Representative Keith Sommer, extends the terms of TIF districts in the city of Pontiac and the village of Downs. The IAR was NEUTRAL on this measure. The House approved Senate Bill 1825 this week that provides that on or before October 1, 2009, the county assessor of Madison County, Monroe County, and St. Clair County are required to reassess all property in the county at 33 1/3% of the fair cash value of the property, as determined by the Department's sales ratio studies for the most recent year preceding the assessment year. The Senate Revenue Committee recommended that the full Senate concur with this proposal but the full Senate has not, to date, acted upon the bill. The bill is sponsored by Representative Tom Holbrook and Senate Majority Leader James Clayborne. The IAR was NEUTRAL. There was also final legislative action this week on Senate Bill 1975 which amends the Illinois Income Tax Act’s definition of "captive real estate investment trusts". The legislation clarifies that to be a captive real estate investment trust, at least 50% of the voting power must be controlled by a single corporation (now, controlled by a single person). The legislation also exempts from the definition certain real estate investment trusts that are owned and controlled by certain entities that are organized outside of the laws of the United States. The IAR MONITORED this legislation sponsored by Senator Don Harmon and Representative John Bradley.

Illinois Association of REALTORS® 522 South Fifth Street Springfield, IL 62701Ph. 217/529-2600 FAX 217/529-3904 www.illinoisrealtor.org iarnews@iar.orgState Capitol Report is distributed Fridays when the General Assembly is in session. For more information, contact Greg St. Aubin, Director of IAR Governmental Affairs, gstaubin@iar.org or Julie Sullivan, Assistant Director, Legislative and Political Affairs, jsullivan@iar.org. Full text of legislation cited in this newsletter can be found at www.ilga.gov.

Thursday, May 21, 2009

Homebuyer Tax Credit

Daily Real Estate News May 21, 2009 HUD: Homebuyer Tax Credit Loans Still on Track News reports that the federal government is backing away from its plan to permit eligible borrowers to monetize the first-time homebuyer tax credit are off the mark, a spokesperson for the U.S. Department of Housing and Urban Development says.
"The technical details are still being finalized and will soon be published in a mortgagee letter and posted on our Web site," Lemar Wooley, a HUD spokesperson, told REALTOR® Magazine Wednesday afternoon.
Under the guidance that's under development, state agencies and other HUD-approved entities would be able to provide short-term bridge loans that households could use to help with their downpayment. The loans would be repaid with the proceeds from the households' federal tax credit.
The loans were announced on the opening day of NAR's 2009 Midyear Legislative Meetings in Washington, D.C., last week. In his announcement, HUD Secretary Shaun Donovan said guidance would be issued shortly.
When the guidance is released, it is expected to cover eligible lenders and set parameters for loan terms and repayment.
Source: REALTOR® Magazine Online

Wednesday, May 6, 2009

Springfield Update

IAR State Capitol Report

The General Assembly was in session Tuesday April 28-Thursday, April 30 this week as work continued in committees on various bills. Next week marks a critical deadline- Friday, May 8th is the committee hearing deadline. As you know, the IAR has been actively lobbying against pending legislation (HB 1195 and SB 2101) that seeks to allow ALL municipalities in Illinois to create an independent entity called a “Land Bank Authority” (LBA). It is our understanding that the sponsor and proponents are intending to use one of these bills for limited provisions regarding liens and notices that have been agreed to by the lending lobby and the other bill will be used to advance the Land Banking Authority provisions. The IAR will remain vigilant in our opposition and we urge you to continue to contact your elected officials. The IAR position paper on the Land Banking Authority legislation is available on the IAR website. House Bill 2439, an initiative of the IAR was unanimously approved by the Senate Environment Committee this week. This bill, sponsored by Senator Iris Martinez and Representative Dan Reitz, amends the Illinois Radon Awareness Act to make necessary clarifications to the law, including a provision that clearly exempts transfers involving a dwelling unit located on the third story or higher above ground level, including dwelling units in condominiums and cooperatives. The IAR SUPPORTS this bill which is pending final passage in the Senate. Another radon related bill was also approved in the Senate Licensed Activities Committee. That bill, sponsored by Senator Jacqueline Collins and Representative Dan Reitz, prohibits the sale of a device to detect the presence of radon or radon progeny without the prior approval of the device from the Illinois Emergency Management Agency and requires that all electronic radon detection devices to be calibrated to ensure the accuracy and precision of their measurements. The bill also creates a Task Force on Radon-Resistant Building Codes to make recommendations to the Governor, the IEMA, IEPA and the Pollution Control Board concerning the adoption of rules for building codes. The IAR is represented on the Task Force. The IAR is NEUTRAL. The House unanimously passed Senate Bill 1053 this week marking FINAL action on this bill for the spring session. SB 1053, sponsored by Senator Don Harmon and Representative Sid Mathias, amends the Code of Civil Procedure to extend the time limit within which a judgment for possession obtained in an eviction action may be enforced from 90 to 120 days. The IAR was NEUTRAL on this measure which will be sent to the Governor for his consideration. A duplicate bill, HB 3690 was approved in the Senate Judiciary Committee this week and sent to the Senate floor. The Senate Agriculture and Conservation Committee advanced House Bill 1087 this week. This bill, sponsored by Senator John Sullivan and Representative Dan Reitz, modifies the existing Illinois Forestry Development Act and establishes into State law an Illinois Forestry Development Council. The Council is directed to study and evaluate the forest resources and forest industry of Illinois and the legislation spells out specific duties. A duplicate bill is scheduled to be heard in the House Agriculture and Conservation Committee next week (SB 1413). The IAR is NEUTRAL on these bills. The House Business and Occupational Licenses Committee advanced Senate Bill 1579 this week. This bill, sponsored by Representative Elaine Nekritz and Senator A. J. Wilhelmi, creates the Community Association Manager Act and require managers of community associations (condominiums, cooperatives, townhouse developments and other common interest communities) of more than 10 units to be licensed by the Illinois Department of Financial and Professional Regulation (IDFPR) after January 1, 2011. Licensed real estate brokers and salespersons are exempt from the education requirement. The IAR SUPPORTS this legislation which is now pending in the House. A duplicate measure (HB 271) is scheduled to be heard next week in the Senate Judiciary Committee. Also approved this week in the House Judiciary I- Civil Law Committee was Senate Bill 2111, sponsored by Representative Dan Reitz and Senator Don Harmon. This bill is an initiative of the Land Title Association related to disbursements of funds. An amendment was adopted to make a correction in the drafting of the bill. The IAR is NEUTRAL. The Senate Judiciary Committee approved several bills of interest this week. House Bill 153, sponsored by Senator Iris Martinez and Representative LaShawn Ford, requires that any deed executed under the Code of Civil Procedure or judgment vesting title by a consent foreclosure include the grantee’s or mortgagee’s name and the name of a contact person, street and mailing addresses and telephone number. The IAR is NEUTRAL. House Bill 688, sponsored by Senator Jacqueline Collins and Representative Marlow Colvin, is an initiative of the city of Chicago and is intended to expedite receivership procedures for abandoned or dilapidated condominium property. The IAR is NEUTRAL. House Bill 2351, sponsored by Senator Donne Trotter and Representative Harry Osterman, modifies existing law regarding excess funds from the now defunct Torrens fund in Cook County (Cook County had used this system of recording ownership interest in property- Illinois law abolished it in the early 1990s). The IAR SUPPORTS this bill. Legislation to ban text messaging while driving continues to advance in the General Assembly. The Senate Transportation Committee unanimously approved House Bill 71 this week. The bill prohibits a person from composing, sending or reading an electronic message while driving. Exceptions are in the bill for law enforcement, a driver reporting an emergency situation, a driver using an electronic communication device in hands-free or voice-activated mode and for a driver of a commercial vehicle reading a message on a permanently installed communication device. This bill is sponsored by Senator Martin Sandoval and Representative John D’Amico. The IAR will continue to MONITOR this issue. The Senate Local Government Committee advanced several bills of interest this week. House Bill 466, sponsored by Senator Michael Frerichs and Representative Naomi Jakobbson, amends the law related to pre-annexation agreements. The bill adds Champaign County to those counties specified to follow certain procedures. The IAR is NEUTRAL. House Bill 629, sponsored by Senator Deanna Demuzio and Representative Frank Mautino, specifies smaller site construction site stormwater permit fees. The IAR SUPPORTS this bill. House Bill 2451, sponsored by Senator Dan Rutherford and Representative Ken Dunkin, would allow municipalities to combine costs associated with certain nuisance liens (landscape, trees, garbage/debris, and pests) into a single lien. The bill also makes these four sections more consistent. The IAR is NEUTRAL. House Bill 3987 was debated and approved this week over the opposition of the municipal lobby. This bill, sponsored by Senator Don Harmon and Representative Julie Hamos expands the existing Energy Efficient Commercial Building Act first enacted in 2004 to cover both commercial and residential buildings (with certain exemptions). While HB 3987 expands the Act to cover both commercial and residential buildings there were important provisions added to address specific concerns of the IAR and the Home Builders Association which removed our opposition. The IAR is now NEUTRAL on this measure. Various bills were approved this week in Committee to extend the term of Tax Increment Financing Districts in various municipalities- including Downs (HB 241/SB 1553), Sherman (HB 870), Steeleville (HB 1086), Morris (HB 1628), Macomb (SB 242) and Washington (SB 1277). The IAR is NEUTRAL on these bills. The House Environment and Energy Committee approved Senate Bill 1489 this week with additional language added in an amendment. This bill, sponsored by Representative Elaine Nekritz and Senator Iris Martinez, creates the Green Infrastructure for Clean Water Act. The bill directs the Illinois EPA, in conjunction with the Department of Natural Resources, the Department of Transportation and the Capital Development Board, stormwater management agencies and other interested parties, to submit a report to the General Assembly and Governor on stormwater including green infrastructure use and benefits. Also to be contemplated is the feasibility of devoting 20% of the Water Revolving Fund to green infrastructure, water and energy efficiency and other “environmentally innovative activities” on a long-term basis. The IAR is MONITORING this issue. House Bill 2005, sponsored by Senator Jacqueline Collins and Representative Andre Thapedi, received unanimous approval in the Senate Financial Institutions Committee this week. This bill was negotiated in the House with the IAR and various lending groups. Currently Illinois law provides that if a sale is held and a party entitled to receive notice does NOT receive notice, that party may ask the court to set aside the sale PROVIDED that such party guarantees or secures by bond a bid equal to the successful bid at the prior sale. This bill modifies that language to provide that no such guarantee or bond is required if the party is the mortgagor, the real estate sold is residential real estate and the mortgagor occupies the residential real estate at the time the motion is filed. The IAR is NEUTRal

State Capitol Report is distributed Fridays when the General Assembly is in session. For more information, contact Greg St. Aubin, Director of IAR Governmental Affairs, gstaubin@iar.org or Julie Sullivan, Assistant Director, Legislative and Political Affairs, jsullivan@iar.org. Full text of legislation cited in this newsletter can be found at www.ilga.gov.

Rep. Froehlich Questioned

http://www.facebook.com/ext/share.php?sid=78934423705&h=TApOx&u=2R-c4&ref=mf

Froehlich QuestionedOver Tax Appeals
CHICAGO - Imagine a state representative knocking on your door, offering to lower your property taxes. That’s exactly what some people who spoke to Fox Chicago News say happened to them.
“[He was] just knocking on the door, introducing himself…and he said would you like my help with your property taxes,” explains Renee and Tom Walsh
Another person, Alan Szczeblowski, recalls, “He had us sign a thing that said he would get our taxes lowered.”
They’re talking about State Representative Paul Froehlich.
“He had forms and I said sure. I signed it and we wound up getting a reduction," says Tom Walsh
They also say that Froehlich asked if he could you put a campaign sign in their yard.
"I said that would be fine. I mean he did me a favor," explains Renee Walsh.
But that leads to the question, was it a savvy political move, a way to win votes, or something else?
Froehlich offered hundreds of taxpayers in Schaumburg, Elk Grove Village and Hoffman Estates a chance to reduce their taxes. Fox Chicago News obtained the names of 175 residents and businesses. Nearly everyone, 94%, won their appeal, from as little as a couple hundred bucks to six figures. How Froehlich did it is now the subject of a Cook County State's Attorney's investigation.
Judy McCurdy was Froehlich’s district office supervisor until he fired her last November. Now, she’s blowing the whistle, providing us with internal documents like a walk sheet he used to visit registered voters. There are notes connecting the tax appeals and campaign signs in his own handwriting
“What he said was these tax savings would translate to votes," says McCurdy.
When we asked Froehlich about the campaign signs he said, “Every elected official that I know of does constituent service, tries to help constituents in a variety of ways."
Those constituents included two of his major campaign contributors. Froehlich helped the owners of the Schaumburg Comfort Inn Suites and Wingate Hotel win big tax reductions. On one internal document, Froehlich does the math, calculating a third of the savings, what a tax attorney would take. Underneath he wrote, "I asked the owner of the hotel and he agreed to cover my sign bill - twelve thousand -- and provide rooms for workers in '08 and '10.
When asked about the note Froehlich replied, “I’ve never had the authority to lower anybody's assessment never. Now if I would have I’d understand your point."
But when we looked at his campaign contributions we found a payment for campaign signs.
Another handwritten note shows Froehlich calculating his own cut from the Wingate tax appeal, more than $14,000. Three weeks later, the Wingate owners began sending checks to pay for his campaign office.
They also picked up the tab for more than $8000 in hotel rooms for campaign workers in last year's election. It was Froehlich's first election after jumping to the Democratic Party and he had the Democratic power brokers behind him, including Joseph Berrios, head of the Cook County Democratic Party and head of the tax board of review. Freohlich and Berrios ran an outreach program to teach residents how to appeal their taxes.
Brendan Houlihan also sits on the tax board. He says he was excluded from the event and all of the appeals generated by Froehlich went to Berrios's staff even though Houlihan's district covers that area. Now the board has launched an investigation of hundreds of appeals filed by Froehlich and whether he was getting inside help.
"Soon we'll have some results to report but meanwhile we're under investigation there'll be more to follow soon," says Houlihan:
And the people whose taxes were reduced got a friendly letter in the mail, not from the tax board, but from Froehlich's office saying, “I'm happy to inform you the assessment appeal I worked out for you was successful

Monday, November 24, 2008

Springfield Update

Illinois Association of REALTORS
State Capitol Report
Friday November 21, 2008

“Anyone who says they are not interested in politics is like a drowning man who insists he is not interested in water.” ~Author Unknown
The House and Senate reconvened in Springfield on Wednesday and Thursday to wrap up the annual fall session.
- An amendment #7 to House Bill 2973 was adopted this week after being worked out among the mortgage lending lobby, the Illinois Department of Financial and Professional Regulation (IDFPR), the Attorney General’s office and other interested parties to address foreclosure actions. The bill adds a new section to the Code of Civil Procedure regarding procedures and forbearances for delinquent residential mortgages. The bill provides that if a mortgage secured by residential real estate becomes delinquent by more than 30 days the mortgagee must mail a notice advising the homeowner that he/she may wish to seek approved housing counseling (defined in the legislation as a counseling agency approved by HUD). No foreclosure action can begin before mailing this notice- which is spelled out in the legislation. If, within the 30-day period an approved counseling agency provides written notice to the mortgagee that the homeowner is seeking approved counseling services, then no legal action shall be instituted for 30 days after the date of that notice. During the 30-day period the homeowner or counselor or both may prepare and proffer to the mortgagee a proposed sustainable loan workout plan (defined in the legislation). The mortgagee determines whether to accept the proposed sustainable loan workout plan. If the parties agree to the plan no legal action shall be instituted for as long as the sustainable loan workout plan is complied with by the homeowner. If IDFPR determines that the demand for counseling services in an area exceeds the number of available approved counseling agencies, the Secretary can certify other persons or entities as approved counseling agencies. However, the legislation prohibits a for profit entity from being certified. The new provisions of this legislation do NOT apply to mortgages issued or originated on or after the effective date of this legislation and ONLY apply to a principal residence. These provisions will be repealed in two years. House Bill 2973, as amended was approved by the Senate on Thursday, November 20th and sent to the House for their consideration when the House returns in January. The bill is sponsored by Senator Jacqueline Collins and Representative Julie Hamos.
- As you may be aware, as part of the Housing and Economic Recovery Act of 2008, Congress included almost $4 billion in funding to HUD to provide for a Neighborhood Stabilization Program (NSP). The Program is intended to provide emergency assistance to state and local governments to acquire and redevelop foreclosed properties that might otherwise become sources of abandonment and blight within their communities. The NSP is designed to provide grants to purchase foreclosed or abandoned homes and to rehabilitate, resell, or redevelop these homes in order to stabilize neighborhoods. All activities carried out under the NSP must benefit households earning no more than 120% of the area median income (AMI), and at least 25% of the funds must benefit households earning no more than 50% AMI. The State of Illinois received a total allocation of approximately $172 million, with about $53 million going towards a state-run program, and the rest of the monies being distributed directly to local governments similar to CDBG monies. IAR provided comments on the proposed plan for the state’s allocation. Local association Government Affairs Directors (GADs) are also working with their local governments on their allocation of NSP. Further information on the program can be found here: www.dhs.state.il.us/page.aspx?item=40593

- The House took final action on legislation this week that had been stalled since the spring session. House Bill 5037, sponsored by Representative Marlow Colvin, deals with distressed condominium property. This legislation is an initiative of the city of Chicago and is intended to expedite receivership procedures for abandoned or dilapidated condominium property. The legislation would allow a court to appoint a receiver to manage the property with the ultimate goal of selling the property and allowing the reuse of the property. The legislation was amended to address concerns raised by the IAR and the banking lobby and the IAR is now NEUTRAL. The bill has been sent to the Senate which has two days in January to consider the legislation.

- Legislation was overwhelmingly approved this week that creates a criminal offense for retaliating against a judge by filing any false lien or encumbrance against the real or personal property of a Supreme, Appellate, Circuit or Associate Judge in Illinois. Senate Bill 2452, sponsored by Senator John Cullerton and Representative Bob Molaro, has been sent to the Governor for his consideration.

- Final action also was taken this week on House Bill 5730 which extends the life of the Tax Increment Financing (TIF) district in the Village of Hoffman Estates from 23 to 35 years. The bill has been sent to the Governor for his consideration.

- Generally, State law requires municipal officials or employees involved in the planning and preparation of a TIF plan or project owning an interest, direct or indirect, in property included in the redevelopment to disclose such interest and to refrain from official involvement or voting on matters related to the area. Further, no member or employee can acquire any property except for specific exceptions added if a single parcel of property is used exclusively as the member’s primary residence. Senate Bill 826, approved by the House this week provides a two-year period whereby a single property interest could be acquired by a member of the municipal corporate authority and NOT constitute an interest in any property provided 1) the property is used exclusively as the member’s primary residence; 2) the member discloses the acquisition to the municipal clerk; 3) the acquisition is for fair market value; 4) the member acquires the property as a result of the property being publicly advertised for sale; and 5) the member refrains from voting on, and communicating with other members concerning, any matter when the benefits to the area would be significantly greater than the benefits to the municipality as a whole. A similar exception was approved in the 2006 session for a one-year period effective in 2007. SB 826, sponsored by Representative Dan Burke and Senator Michael Noland, has been sent to the Senate for consideration in January.

- As we previously reported the current leaders of the Senate, Senate President Emil Jones and Republican Leader Frank Watson, will end their terms as leaders at the end of the 95th General Assembly. Senator Jones did not seek reelection and Senator Frank Watson did not seek reelection as the leader but will remain as the Senator from the 51st District. The Senate Majority and Minority caucuses met this week and selected their new leaders for the 96th General Assembly which begins with the inaugural on January 14, 2009. The new Senate President will be Senator John Cullerton, a Democrat from the 6th District in Chicago. The new Republican Leader will be Senator Christine Radogno, a Republican from the 41st District in LaGrange. The leaders in the House, Michael Madigan and Tom Cross, will remain the same.

- The General Assembly is scheduled to reconvene January 12-13, 2009 to conclude the business of the 95th General Assembly. The 96th General Assembly, as noted above, will be sworn in on January 14, 2009.

- Speaker Michael Madigan has released a calendar for the 2009 session which is available on the General Assembly’s website- www.ilga.gov.

Friday, November 7, 2008

Springfield Update

Illinois Association of REALTORS
State Capitol Report
Friday October 31, 2008

“Do you ever get the feeling that the only reason we have elections is to find out if the polls were right?” ~Robert Orben
- Our legislative newsletter has a new name! “Quorum Call-Week in Review” is now the “State Capitol Report”.

State Capitol Report is distributed Fridays when the Illinois General Assembly is in session. For more information, contact Greg St. Aubin, Director of IAR Governmental Affairs, gstaubin@iar.org, or Julie Sullivan, Assistant Director, Legislative and Political Affairs, jsullivan@iar.org. Full text of legislation cited in this newsletter can be found at www.ilga.gov.

- After months of campaigning, hard-hitting campaign ads and an incredible amount of work Election Day is a few days away. If you have not already voted through the State’s Early Voting Program or by absentee ballot PLEASE exercise your right and VOTE ON TUESDAY, NOVEMBER 4TH! RPAC was involved in several key races donating contributions and conducting Opportunity Races throughout the State. A summary of the election results will be provided in the next issue.
- The Illinois General Assembly is scheduled to conducts its annual fall veto session on November 12-14 and November 19-21. . While the primary purpose of the six-day fall session is the consideration of gubernatorial vetoes from the spring session, the General Assembly typically considers other initiatives. It should be noted that the House of Representatives cancelled its session days for the first week of the veto session indicating that they had already taken action on the Governor’s vetoes on previous session days this summer/fall. As of today, the Senate is still scheduled to return to Springfield on November 12th.
- Since the last issue of the newsletter final action occurred on a few issues of interest to REALTORS.

--On October 7, 2008 the Governor signed into law Senate Bill 790 (Public Act 95-1000) to authorize the sweep of over $221 million from dedicated funds, including $5 million from the Real Estate License Administration Fund and $250,000 from the Real Estate Recovery Fund. You will recall that this bill creates the Budget Relief Fund to hold authorized swept funds to shore up the State’s General Revenue Fund. While legislators understand all the arguments against the sweep of dedicated funds most will point to the fact that this has been a budget solution used by previous governors. The IAR may have an opportunity for a hearing on the legal merits of this issue in Sangamon County Circuit Court based on our 2006 lawsuit filed in Sangamon County, challenging the constitutionality of such a sweep of the Real Estate License Administration Fund (RELAF). The State of Illinois entered into a stipulation in that case that precludes the State from transferring any funds from the RELAF to be used for any purpose other than those specified in the Real Estate License Act without giving IAR 21 days notice.

--On October 6, 2008 the Governor signed into law Senate Bill 2287 (Public Act 95-999). This legislation, sponsored by Senator Kwame Raoul and Representative Pat Lindner, initially sought to expand the existing Safe Homes Act to allow tenants to recover a minimum of $2,000 plus attorney’s fees from a landlord if the landlord shares “any information provided by the tenant” in exercising his/her rights under the Act to a prospective landlord. The IAR had pointed to a number of concerns with the original legislation including the fact that a tenant would not have to actually incur any damages in order to recover the $2,000. Representative Pat Lindner, amended the bill to hold the landlord liable for actual damages up to $2,000 resulting from the disclosure- instead of liable for any damages resulting from the disclosure or $2,000, whichever is greater. This new language is now in effect-becoming law on the day it was signed by the Governor.


For more information, contact Greg St. Aubin, Director of IAR Governmental Affairs, gstaubin@iar.org, or Julie Sullivan, Assistant Director, Legislative and Political Affairs, jsullivan@iar.org.

Wednesday, July 30, 2008

President Signs Housing Bill

Bush signs housing bill to provide mortgage relief
By JENNIFER LOVEN, Associated Press Writer1 hour, 55 minutes ago
President Bush on Wednesday signed a massive housing bill intended to provide mortgage relief for 400,000 struggling homeowners and stabilize financial markets.
Bush signed the bill without any fanfare or signing ceremony, affixing his signature to the measure he once threatened to veto, in the Oval Office in the early morning hours. He was surrounded by top administration officials, including Treasury Secretary Henry Paulson and Housing Secretary Steve Preston.
"We look forward to put in place new authorities to improve confidence and stability in markets," White House spokesman Tony Fratto said. He said that the Federal Housing Administration would begin right away to implement new policies "intended to keep more deserving American families in their homes."
The measure, regarded as the most significant housing legislation in decades, lets homeowners who cannot afford their payments refinance into more affordable government-backed loans rather than losing their homes.
It offers a temporary financial lifeline to troubled mortgage companies Fannie Mae and Freddie Mac and tightens controls over the two government-sponsored businesses.
The House passed the bill a week ago; the Senate voted Saturday to send it to the president.
Bush didn't like the version emerging from Congress, and initially said he would veto it, particularly over a provision containing $3.9 billion in neighborhood grants. He contended the money would benefit lenders who helped cause the mortgage meltdown, encouraging them to foreclose rather than work with borrowers.
But he withdrew that threat early last week, saying hurting homeowners could not wait — and even blaming the Democratic Congress' delays in action for forcing an imperfect solution.
Meanwhile, many Republicans, particularly those from areas hit hardest by housing woes, were eager to get behind a housing rescue as they looked ahead to tough re-election contests. Paulson's request for the emergency power to rescue Fannie Mae and Freddie Mac helped push through the measure. So did the creation of a regulator with stronger reins on the government-sponsored companies, as Republicans long have sought.
Democrats won cherished priorities in the bargain: the aid for homeowners, a permanent affordable housing fund financed by Fannie Mae and Freddie Mac, and the neighborhood grants.
The bill takes several approaches to curing the ailing housing market.
It aims to spare an estimated 400,000 debt-strapped homeowners, many of whom owe more their houses are worth, from foreclosure by allowing them to get more affordable mortgages backed by the Federal Housing Administration.
The FHA could insure $300 billion in such mortgages, which would be available to homeowners who showed they could afford a new loan. Banks would first have to agree to take a large loss on the existing loans in exchange for avoiding an often-costly foreclosure.
The plan also is designed to relieve a broader credit crunch that has taken hold because of rising defaults and falling home values. To free up safer and more affordable mortgage credit, the bill permanently would increase to $625,000 the size of home loans that Fannie Mae and Freddie Mac can buy and the FHA can insure. They also could buy and back mortgages 15 percent higher than the median home price in certain areas.
It goes far beyond addressing the current crisis, however.
The legislation overhauls the Depression-era FHA. It requires lenders to show how high a borrower's payment could get under the terms of his mortgage. It provides $180 million in pre-foreclosure counseling for struggling homeowners.
The Treasury Department gains unlimited power, until the end of 2009, to lend money to Fannie Mae and Freddie Mac or buy their stock should they need it. The Federal Reserve takes on a new "consultative" role overseeing the companies.
The measure includes $15 billion in tax cuts, including a significant expansion of the low-income housing tax credit and a credit of up to $7,500 for first-time home buyers for houses purchased between April 9, 2008, and July 1, 2009.
Democratic leaders, recognizing that the measure could be one of the last items to become law during what's left of their abbreviated election-year schedule, tacked on an $800 billion increase, to $10.6 trillion, in the statutory limit on the national debt.
Conservative Republicans were vehemently opposed to the bill, particularly the help for Fannie Mae and Freddie Mac. Critics charge the companies enjoy lavish profits in good times and wield their outsized political clout to resist regulation while depending on the government to bail them out should they falter.

Members meet with Senator Murphy after Legislative Breakfast