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Illinois General Assembly· SB 3527Governor Approved

CONDO-CI COLLECTION POLICIES, the official text

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SB3527 Enrolled                     LRB104 18988 JRC 32433 b

1   AN ACT concerning civil law.

2   Be it enacted by the People of the State of Illinois,

3 represented in the General Assembly:

4   Section 5. The Common Interest Community Association Act

5 is amended by changing Sections 1-35 and 1-45 as follows:

6   (765 ILCS 160/1-35)

7   Sec. 1-35. Member powers, duties, and obligations.

8   (a) The provisions of this Act, the declaration, bylaws,

9 other community instruments, and rules and regulations that

10 relate to the use of an individual unit or the common areas

11 shall be applicable to any person leasing a unit and shall be

12 deemed to be incorporated in any lease executed or renewed on

13 or after the effective date of this Act. Unless otherwise

14 provided in the community instruments, with regard to any

15 lease entered into subsequent to the effective date of this

16 Act, the unit owner leasing the unit shall deliver a copy of

17 the signed lease to the association or if the lease is oral, a

18 memorandum of the lease, not later than the date of occupancy

19 or 10 days after the lease is signed, whichever occurs first.

20  (b) If there are multiple owners of a single unit, only one

21 of the multiple owners shall be eligible to serve as a member

22 of the board at any one time, unless the unit owner owns

23 another unit independently.
    SB3527 Enrolled          -2-        LRB104 18988 JRC 32433 b

1   (c) Two-thirds of the membership may remove a board member

2 as a director at a duly called special meeting.

3   (d) In the event of any resale of a unit in a common

4 interest community association by a member or unit owner other

5 than the developer, the board shall make available for

6 inspection to the prospective purchaser, upon demand, the

7 following:

8   (1) A copy of the declaration, other instruments, and

9   any rules and regulations.

10  (2) A statement of any liens, including a statement of

11  the account of the unit setting forth the amounts of

12  unpaid assessments and other charges due and owing.

13  (3) A statement of any capital expenditures

14  anticipated by the association within the current or

15  succeeding 2 fiscal years.

16  (4) A statement of the status and amount of any

17  reserve or replacement fund and any other fund

18  specifically designated for association projects.

19  (5) A copy of the statement of financial condition of

20  the association for the last fiscal year for which such a

21  statement is available.

22  (6) A statement of the status of any pending suits or

23  judgments in which the association is a party.

24  (7) A statement setting forth what insurance coverage

25  is provided for all members or unit owners by the

26  association for common properties.
    SB3527 Enrolled       -3-        LRB104 18988 JRC 32433 b

1   (8) A copy of the collection policy adopted under

2   subsection (j) of Section 1-45.

3   The principal officer of the board or such other officer

4 as is specifically designated shall furnish the above

5 information within 30 days after receiving a written request

6 for such information.

7   A reasonable fee covering the direct out-of-pocket cost of

8 copying and providing such information may be charged by the

9 association or the board to the unit seller for providing the

10 information.

11 (Source: P.A. 97-605, eff. 8-26-11; 97-1090, eff. 8-24-12;

12 98-842, eff. 1-1-15.)

13  (765 ILCS 160/1-45)

14  Sec. 1-45. Finances.

15  (a) Each member shall receive through a prescribed

16 delivery method, at least 30 days but not more than 60 days

17 prior to the adoption thereof by the board, a copy of the

18 proposed annual budget together with an indication of which

19 portions are intended for reserves, capital expenditures or

20 repairs or payment of real estate taxes.

21  (b) The board shall provide all members with a reasonably

22 detailed summary of the receipts, common expenses, and

23 reserves for the preceding budget year. The board shall (i)

24 make available for review to all members an itemized

25 accounting of the common expenses for the preceding year
    SB3527 Enrolled           -4-        LRB104 18988 JRC 32433 b

1 actually incurred or paid, together with an indication of

2 which portions were for reserves, capital expenditures or

3 repairs or payment of real estate taxes and with a tabulation

4 of the amounts collected pursuant to the budget or assessment,

5 and showing the net excess or deficit of income over

6 expenditures plus reserves or (ii) provide a consolidated

7 annual independent audit report of the financial status of all

8 fund accounts within the association.

9   (c) If an adopted budget or any separate assessment

10 adopted by the board would result in the sum of all regular and

11 separate assessments payable in the current fiscal year

12 exceeding 115% of the sum of all regular and separate

13 assessments payable during the preceding fiscal year, the

14 common interest community association, upon written petition

15 by members with 20% of the votes of the association delivered

16 to the board within 14 days of the board action, shall call a

17 meeting of the members within 30 days of the date of delivery

18 of the petition to consider the budget or separate assessment;

19 unless a majority of the total votes of the members are cast at

20 the meeting to reject the budget or separate assessment, it

21 shall be deemed ratified.

22  (d) If total common expenses exceed the total amount of

23 the approved and adopted budget, the common interest community

24 association shall disclose this variance to all its members

25 and specifically identify the subsequent assessments needed to

26 offset this variance in future budgets.
    SB3527 Enrolled  -5-                   LRB104 18988 JRC 32433 b

1   (e) Separate assessments for expenditures relating to

2 emergencies or mandated by law may be adopted by the board

3 without being subject to member approval or the provisions of

4 subsection (c) or (f) of this Section. As used herein,

5 "emergency" means a danger to or a compromise of the

6 structural integrity of the common areas or any of the common

7 facilities of the common interest community. "Emergency" also

8 includes a danger to the life, health or safety of the

9 membership.

10  (f) Assessments for additions and alterations to the

11 common areas or to association-owned property not included in

12 the adopted annual budget, shall be separately assessed and

13 are subject to approval of a simple majority of the total

14 members at a meeting called for that purpose.

15  (g) The board may adopt separate assessments payable over

16 more than one fiscal year. With respect to multi-year

17 assessments not governed by subsections (e) and (f) of this

18 Section, the entire amount of the multi-year assessment shall

19 be deemed considered and authorized in the first fiscal year

20 in which the assessment is approved.

21  (h) The board of a common interest community association

22 shall have the authority to establish and maintain a system of

23 master metering of public utility services to collect payments

24 in conjunction therewith, subject to the requirements of the

25 Tenant Utility Payment Disclosure Act.

26  (i) An association subject to this Act that consists of
    SB3527 Enrolled          -6-  LRB104 18988 JRC 32433 b

1 100 or more units shall use generally accepted accounting

2 principles in fulfilling any accounting obligations under this

3 Act.

4   (j) To promote responsible governance, the board must

5 adopt policies and procedures concerning the collection of

6 unpaid assessments.

7       (1) Notwithstanding any provision in the community

8   instruments to the contrary, the association or a holder

9   or assignee of the association's debt, whether the holder

10  or assignee of the association's debt is an entity or a

11  natural person, shall not take legal action to collect

12  common expenses unless the association or a holder or

13  assignee of the association's debt has adopted, and

14  follows, a written policy governing the collection of

15  unpaid assessments. The policy must, at a minimum,

16  specify:

17      (A) the date on which common expenses must be paid

18      to the entity and when an assessment is considered

19      delinquent;

20      (B) any late fees and interest the entity is

21      entitled to impose on a delinquent unit owner's

22      account;

23      (C) any returned-check charges the entity is

24      entitled to impose;

25      (D) the circumstances, if any, under which a unit

26      owner is entitled to enter into a payment plan with the
    SB3527 Enrolled  -7-                 LRB104 18988 JRC 32433 b

1   entity and the minimum terms of the payment plan;

2   (E) the amount or duration of time before the

3   entity refers a delinquent account to an attorney for

4   legal action;

5   (F) the method by which payments may be applied on

6   the delinquent account of a unit owner; and

7   (G) the legal remedies available to the entity to

8   collect on a unit owner's delinquent account pursuant

9   to the governing documents of the entity and Illinois

10  law.

11  (2) As used in this subsection, "entity" means an

12  association or a holder or assignee of the association's

13  debt, whether the holder or assignee of the association's

14  debt is an entity or a natural person.

15 (Source: P.A. 100-292, eff. 1-1-18.)

16  Section 10. The Condominium Property Act is amended by

17 changing Sections 18.4 and 22.1 as follows:

18  (765 ILCS 605/18.4) (from Ch. 30, par. 318.4)

19  Sec. 18.4. Powers and duties of board of managers. The

20 board of managers shall exercise for the association all

21 powers, duties and authority vested in the association by law

22 or the condominium instruments except for such powers, duties

23 and authority reserved by law to the members of the

24 association. The powers and duties of the board of managers
    SB3527 Enrolled  -8-  LRB104 18988 JRC 32433 b

1 shall include, but shall not be limited to, the following:

2   (a) To provide for the operation, care, upkeep,

3   maintenance, replacement and improvement of the common

4   elements. Nothing in this subsection (a) shall be deemed

5   to invalidate any provision in a condominium instrument

6   placing limits on expenditures for the common elements,

7   provided, that such limits shall not be applicable to

8   expenditures for repair, replacement, or restoration of

9   existing portions of the common elements. The term

10  "repair, replacement or restoration" means expenditures to

11  deteriorated or damaged portions of the property related

12  to the existing decorating, facilities, or structural or

13  mechanical components, interior or exterior surfaces, or

14  energy systems and equipment with the functional

15  equivalent of the original portions of such areas.

16  Replacement of the common elements may result in an

17  improvement over the original quality of such elements or

18  facilities; provided that, unless the improvement is

19  mandated by law or is an emergency as defined in item (iv)

20  of subparagraph (8) of paragraph (a) of Section 18, if the

21  improvement results in a proposed expenditure exceeding 5%

22  of the annual budget, the board of managers, upon written

23  petition by unit owners with 20% of the votes of the

24  association delivered to the board within 21 days of the

25  board action to approve the expenditure, shall call a

26  meeting of the unit owners within 30 days of the date of
    SB3527 Enrolled    -9-             LRB104 18988 JRC 32433 b

1   delivery of the petition to consider the expenditure.

2   Unless a majority of the total votes of the unit owners are

3   cast at the meeting to reject the expenditure, it is

4   ratified.

5   (b) To prepare, adopt and distribute the annual budget

6   for the property.

7   (c) To levy and expend assessments.

8   (d) To collect assessments from unit owners.

9   (e) To provide for the employment and dismissal of the

10  personnel necessary or advisable for the maintenance and

11  operation of the common elements.

12  (f) To obtain adequate and appropriate kinds of

13  insurance.

14  (g) To own, convey, encumber, lease, and otherwise

15  deal with units conveyed to or purchased by it.

16  (h) To adopt and amend rules and regulations covering

17  the details of the operation and use of the property,

18  after a meeting of the unit owners called for the specific

19  purpose of discussing the proposed rules and regulations.

20  Notice of the meeting shall contain the full text of the

21  proposed rules and regulations, and the meeting shall

22  conform to the requirements of Section 18(b) of this Act,

23  except that no quorum is required at the meeting of the

24  unit owners unless the declaration, bylaws or other

25  condominium instrument expressly provides to the contrary.

26  However, no rule or regulation may impair any rights
    SB3527 Enrolled     - 10 - LRB104 18988 JRC 32433 b

1   guaranteed by the First Amendment to the Constitution of

2   the United States or Section 4 of Article I of the Illinois

3   Constitution including, but not limited to, the free

4   exercise of religion, nor may any rules or regulations

5   conflict with the provisions of this Act or the

6   condominium instruments. No rule or regulation shall

7   prohibit any reasonable accommodation for religious

8   practices, including the attachment of religiously

9   mandated objects to the front-door area of a condominium

10  unit.

11  (i) To keep detailed, accurate records of the receipts

12  and expenditures affecting the use and operation of the

13  property.

14  (j) To have access to each unit from time to time as

15  may be necessary for the maintenance, repair or

16  replacement of any common elements or for making emergency

17  repairs necessary to prevent damage to the common elements

18  or to other units.

19  (k) To pay real property taxes, special assessments,

20  and any other special taxes or charges of the State of

21  Illinois or of any political subdivision thereof, or other

22  lawful taxing or assessing body, which are authorized by

23  law to be assessed and levied upon the real property of the

24  condominium.

25  (l) To impose charges for late payment of a unit

26  owner's proportionate share of the common expenses, or any
    SB3527 Enrolled  - 11 - LRB104 18988 JRC 32433 b

1   other expenses lawfully agreed upon, and after notice and

2   an opportunity to be heard, to levy reasonable fines for

3   violation of the declaration, by-laws, and rules and

4   regulations of the association.

5   (m) By a majority vote of the entire board of

6   managers, to assign the right of the association to future

7   income from common expenses or other sources, and to

8   mortgage or pledge substantially all of the remaining

9   assets of the association.

10  (n) To record the dedication of a portion of the

11  common elements to a public body for use as, or in

12  connection with, a street or utility where authorized by

13  the unit owners under the provisions of Section 14.2.

14  (o) To record the granting of an easement for the

15  laying of cable television or high speed Internet cable

16  where authorized by the unit owners under the provisions

17  of Section 14.3; to obtain, if available and determined by

18  the board to be in the best interests of the association,

19  cable television or bulk high speed Internet service for

20  all of the units of the condominium on a bulk identical

21  service and equal cost per unit basis; and to assess and

22  recover the expense as a common expense and, if so

23  determined by the board, to assess each and every unit on

24  the same equal cost per unit basis.

25  (p) To seek relief on behalf of all unit owners when

26  authorized pursuant to subsection (c) of Section 10 from
    SB3527 Enrolled  - 12 - LRB104 18988 JRC 32433 b

1   or in connection with the assessment or levying of real

2   property taxes, special assessments, and any other special

3   taxes or charges of the State of Illinois or of any

4   political subdivision thereof or of any lawful taxing or

5   assessing body.

6   (q) To reasonably accommodate the needs of a unit

7   owner who is a person with a disability as required by the

8   federal Civil Rights Act of 1968, the Human Rights Act and

9   any applicable local ordinances in the exercise of its

10  powers with respect to the use of common elements or

11  approval of modifications in an individual unit.

12  (r) To accept service of a notice of claim for

13  purposes of the Mechanics Lien Act on behalf of each

14  respective member of the Unit Owners' Association with

15  respect to improvements performed pursuant to any contract

16  entered into by the Board of Managers or any contract

17  entered into prior to the recording of the condominium

18  declaration pursuant to this Act, for a property

19  containing more than 8 units, and to distribute the notice

20  to the unit owners within 7 days of the acceptance of the

21  service by the Board of Managers. The service shall be

22  effective as if each individual unit owner had been served

23  individually with notice.

24  (s) To adopt and amend rules and regulations (l)

25  authorizing electronic delivery of notices and other

26  communications required or contemplated by this Act to
    SB3527 Enrolled      - 13 - LRB104 18988 JRC 32433 b

1   each unit owner who provides the association with written

2   authorization for electronic delivery and an electronic

3   address to which such communications are to be

4   electronically transmitted; and (2) authorizing each unit

5   owner to designate an electronic address or a U.S. Postal

6   Service address, or both, as the unit owner's address on

7   any list of members or unit owners which an association is

8   required to provide upon request pursuant to any provision

9   of this Act or any condominium instrument.

10  (t) To promote responsible governance, the board must

11  adopt policies and procedures concerning the collection of

12  unpaid assessments.

13  (1) Notwithstanding any provision of the

14  condominium instruments and adopted rules and

15  regulations to the contrary, the association or a

16  holder or assignee of the association's debt, whether

17  the holder or assignee of the association's debt is an

18  entity or a natural person, shall not take legal

19  action to collect common expenses unless the

20  association or a holder or assignee of the

21  association's debt has adopted, and follows, a written

22  policy governing the collection of unpaid assessments.

23  The policy must, at a minimum, specify:

24                   (A) the date on which common expenses must be

25  paid to the entity and when an assessment is

26  considered delinquent;
    SB3527 Enrolled  - 14 - LRB104 18988 JRC 32433 b

1                    (B) any late fees and interest the entity is

2   entitled to impose on a delinquent unit owner's

3   account;

4                    (C) any returned-check charges the entity is

5   entitled to impose;

6                    (D) the circumstances, if any, under which a

7   unit owner is entitled to enter into a payment

8   plan with the entity and the minimum terms of the

9   payment plan;

10                   (E) the amount or duration of time before the

11  entity refers a delinquent account to an attorney

12  for legal action;

13                   (F) the method by which payments may be

14  applied on the delinquent account of a unit owner;

15  and

16                   (G) the legal remedies available to the entity

17  to collect on a unit owner's delinquent account

18  pursuant to the governing documents of the entity

19  and Illinois law.

20  (2) As used in this subsection, "entity" means an

21  association or a holder or assignee of the

22  association's debt, whether the holder or assignee of

23  the association's debt is an entity or a natural

24  person.

25  In the performance of their duties, the officers and

26 members of the board, whether appointed by the developer or
    SB3527 Enrolled        - 15 - LRB104 18988 JRC 32433 b

1 elected by the unit owners, shall exercise the care required

2 of a fiduciary of the unit owners.

3   The collection of assessments from unit owners by an

4 association, board of managers or their duly authorized agents

5 shall not be considered acts constituting a collection agency

6 for purposes of the Collection Agency Act.

7   The provisions of this Section are applicable to all

8 condominium instruments recorded under this Act. Any portion

9 of a condominium instrument which contains provisions contrary

10 to these provisions shall be void as against public policy and

11 ineffective. Any such instrument that fails to contain the

12 provisions required by this Section shall be deemed to

13 incorporate such provisions by operation of law.

14 (Source: P.A. 99-143, eff. 7-27-15; 99-849, eff. 1-1-17;

15 100-292, eff. 1-1-18.)

16  (765 ILCS 605/22.1) (from Ch. 30, par. 322.1)

17  Sec. 22.1. (a) In the event of any resale of a condominium

18 unit by a unit owner other than the developer such owner shall

19 obtain from the Board of Managers and shall make available for

20 inspection to the prospective purchaser, upon demand, the

21 following:

22  (1) A copy of the Declaration, by-laws, other

23  condominium instruments, and any rules and regulations.

24  (2) A statement of any liens, including a statement of

25  the account of the unit setting forth the amounts of
    SB3527 Enrolled  - 16 - LRB104 18988 JRC 32433 b

1   unpaid assessments and other charges due and owing as

2   authorized and limited by the provisions of Section 9 of

3   this Act or the condominium instruments.

4   (3) A statement of any capital expenditures

5   anticipated by the unit owner's association within the

6   current or succeeding 2 fiscal years.

7   (4) A statement of the status and amount of any

8   reserve for replacement fund and any portion of such fund

9   earmarked for any specified project by the Board of

10  Managers.

11  (5) A copy of the statement of financial condition of

12  the unit owner's association for the last fiscal year for

13  which such statement is available.

14  (6) A statement of the status of any pending suits or

15  judgments in which the unit owner's association is a

16  party.

17  (7) A statement setting forth what insurance coverage

18  is provided for all unit owners by the unit owner's

19  association.

20  (8) A statement that any improvements or alterations

21  made to the unit, or the limited common elements assigned

22  thereto, by the prior unit owner are in good faith

23  believed to be in compliance with the condominium

24  instruments.

25  (9) The identity and mailing address of the principal

26  officer of the unit owner's association or of the other
    SB3527 Enrolled          - 17 - LRB104 18988 JRC 32433 b

1   officer or agent as is specifically designated to receive

2   notices.

3   (10) A copy of the collection policy adopted under

4   subsection (t) of Section 18.4.

5   (b) The principal officer of the unit owner's association

6 or such other officer as is specifically designated shall

7 furnish the above information when requested to do so in

8 writing and within 10 business days of the request.

9   (c) Within 15 days of the recording of a mortgage or trust

10 deed against a unit ownership given by the owner of that unit

11 to secure a debt, the owner shall inform the Board of Managers

12 of the unit owner's association of the identity of the lender

13 together with a mailing address at which the lender can

14 receive notices from the association. If a unit owner fails or

15 refuses to inform the Board as required under subsection (c)

16 then that unit owner shall be liable to the association for all

17 costs, expenses, and reasonable attorney's fees and such other

18 damages, if any, incurred by the association as a result of

19 such failure or refusal.

20  A reasonable fee, not to exceed $375, covering the direct

21 out-of-pocket cost of providing such information and copying

22 may be charged by the association or its Board of Managers to

23 the unit seller for providing such information. Beginning one

24 year after the effective date of this amendatory Act of the

25 102nd General Assembly, the $375 fee shall be increased or

26 decreased, as applicable, by a percentage equal to the
SB3527 Enrolled  - 18 - LRB104 18988 JRC 32433 b

1 percentage change in the consumer price index-u during the
2 preceding 12-month calendar year. "Consumer price index-u"
3 means the index published by the Bureau of Labor Statistics of
4 the United States Department of Labor that measures the
5 average change in prices of goods and services purchased by
6 all urban consumers, United States city average, all items,
7 1982-84 = 100. An association may charge an additional $100
8 for rush service completed within 72 hours.
9 (Source: P.A. 102-976, eff. 1-1-23.)
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