New laws affecting real estate in the new year

The new year will bring changes to the political dynamic in Washington, D.C., and in Springfield.

As a result of the November election, Democratic majorities were strengthened in the Illinois congressional delegation, the Illinois State Senate and the Illinois House of Representatives. All of Illinois’ statewide constitutional officers will also be Democrats.

The new members of the 101st General Assembly will be sworn in on Jan. 9, the state’s constitutional officers on Jan. 14 and our work will begin anew.

Here are some of the new laws and legislative changes of interest to Illinois REALTORS® that go into effect on Jan. 1, 2019: 

Changes to Various Real Estate-related Licensure Acts

  • ALL professions licensed under the Illinois Department of Financial and Professional Regulation (IDFPR) with a continuing education requirement will be required to include at least one hour of sexual harassment prevention training for license renewals occurring on or after Jan. 1, 2020.
  • Real estate brokerages can simply notify IDFPR of the branch offices they operate, rather than having to apply for a separate license for those offices. The Real Estate Act was also clarified, especially relating to LLC’s and corporate entities.
  • The Real Estate Appraiser Licensing Act will no longer have an exam requirement for associate real estate trainee appraisers. In addition, there will no longer be a limitation that such trainee licenses may not be renewed more than two times.
  • IDFPR will be authorized to allow applicants to provide his/her individual taxpayer identification number as an alternative to providing a social security number when applying for a license. Additionally, no person may be denied a license, certificate, limited permit or registration solely based on his/her citizenship status or immigration status.

Local Government Consolidation Efforts

  • The Local Government Reduction and Efficiency Division of the Counties Code, first enacted in 2013, will now have shortened timeframes for certain processes in the dissolution of local governmental units.
  • Mosquito Abatement Districts, a special taxing district, can be consolidated or merged. Consolidation can be with other mosquito abatement districts or the District can be annexed to a municipality, a county or township if those governing authorities of the governmental unit agree to accept the functions.
  • The Lake County Board will be permitted to dissolve the Seavey Drainage District which has been inactive for some time. The Lakes Region Sanitary District will also be dissolved upon entering into a dissolution agreement with Lake County for the county to acquire all the assets and responsibilities of the district.
  • The Local Government Electronic Notification Act will allow a unit of local government to establish a process to allow people to select electronic notifications through an electronic notification delivery system for governmental mailings that are now being sent by U.S. mail. This will be an opt in or opt out system, no resident or taxpayer will be required to receive electronically any notifications that are currently required to be sent out by mail.

Taxation, Fees and Financing Issues

  • Illinois’ current historic preservation tax credit program will be expanded statewide, allowing Illinois to compete with neighboring states with similar incentive programs. The new law creates an income tax credit equal to 25 percent of the qualified expenditures incurred by a qualified taxpayer undertaking a qualified rehabilitation plan of a structure located in Illinois and defined as a certified historic structure under the federal Internal Revenue Code. The total amount of credits available in a given year will be limited to $15 million and no project can receive more than $3 million in credits. This credit is in place until 2023.
  • Cook County will be allowed to establish a predictable fee schedule for documents recorded with the recorder (other counties were granted the authority in 2017). The predictable fee schedule eliminates surcharges or fees based upon the individual attributes of documents to be recorded with the county recorder and minimizes errors in estimating and disclosing recording fees, especially given the strictures of the TRID process.
  • The Property Assessed Clean Energy (PACE) Act will be expanded to include new construction. The Illinois Finance Authority will also be authorized to issue bonds in connection with PACE programs.

Other Regulatory Issues

  • The notice language within Illinois’ Home Repair and Remodeling Act has been modified within the consumer rights pamphlet.
  • A pilot program will begin for the county recorder (in counties with a code hearing unit) to establish a process in response to expired and/or unreleased mechanics liens on residential property that can cloud title. Under the program, if a recorder determines there is an expired lien, a “Notice of Expired Lien” must be sent by certified mail to the last known address of the owner. The owner shall confirm in writing that the lien is not involved in pending litigation and may request that the recorder proceed with a referral or serve a Demand to Commence Suit on the lienholder of the expired lien. This pilot program will be repealed Jan.1, 2022.

Flood Control and Stormwater Management

  • A new Flood Control Commission will “study and develop an integrated floodplain management coalition of communities in the Fox River Watershed to serve as an example and catalyst to other watershed communities in the DuPage, Kane, Lake, McHenry and Will County regions to jointly leverage community resources and collaborate…”. The Illinois Department of Natural Resources will be in charge of this appointed commission. Appointments are to be made by the leaders of the General Assembly and the affected county boards. A report is required to be submitted to the General Assembly by Dec. 31, 2019.
  • The number of counties permitted to establish a stormwater management planning committee will be expanded to add counties that contain all or part of an urbanized area. Ten additional downstate counties could be eligible, but ONLY IF authorized to do so by voters in a front door referendum. The stormwater management committees have various regulatory powers, including the authority to impose fees to mitigate increased runoff due to new development. The Illinois law for the downstate counties also permits the imposition of either a property tax OR sales tax if approved by the voters. The authority is also given to allow the committee to make grants to landowners, units of local government and not-for-profit organizations (which could include a HOA).

KEY DATES FOR 2019 SPRING SESSION

January 9
101st General Assembly Inauguration

January 9-10
House and Senate in Session

January 14
Constitutional Officers Inauguration

January 22-24
Illinois REALTORS® Public Policy Meetings (East Peoria)

January 29
House and Senate begin Session

February 15
Bill Introduction Deadline

March 22
Senate Committee Hearing Deadline

March 29
House Committee Hearing Deadline

April 12
Third Reading Deadline

April 15-26
Spring Recess

April 30
Illinois REALTORS® Capitol Conference

May 10
House and Senate Committee Deadline

May 24
Third Reading Deadline

May 31
Scheduled Adjournment Date

The complete 2019 spring calendars for the House and the Senate are available on the General Assembly website www.ilga.gov

About the Author:

Julie Sullivan is Senior Director of Legislative & Political Affairs for Illinois REALTORS®

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