101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3771

 

Introduced 2/14/2020, by Sen. Emil Jones, III

 

SYNOPSIS AS INTRODUCED:
 
New Act

    Creates the Tenant Protection Act. Provides that after a tenant has continuously and lawfully occupied a residential real property for 12 months, the owner of the residential real property shall not terminate the tenancy without just cause. Provides that before an owner of residential real property issues a notice to terminate a tenancy for just cause that is a curable lease violation, the owner shall first give notice of the violation to the tenant with an opportunity to cure the violation. Provides that if an owner of residential real property issues a termination notice based on a no-fault just cause, the owner shall: (1) assist the tenant to relocate by providing a direct payment to the tenant; or (2) waive, in writing, the payment of rent for the final month of the tenancy, prior to the rent becoming due. Provides that an owner of residential real property shall not, over the course of any 12-month period, increase the gross rental rate for a dwelling or a unit more than 5% plus the percentage change in the cost of living, or 10%, whichever is lower, of the lowest gross rental rate charged for that dwelling or unit at any time during the 12 months prior to the effective date of the increase. Provides that if the same tenant remains in occupancy of a unit of residential real property over any 12-month period, the gross rental rate for the unit of residential real property shall not be increased in more than 2 increments over that 12-month period. Requires, on or before January 1, 2031, the Commission on Government Forecasting and Accountability to report to the General Assembly regarding the effectiveness of the Act. Repeals the Act on January 1, 2031. Effective immediately.


LRB101 20335 LNS 69879 b

 

 

A BILL FOR

 

SB3771LRB101 20335 LNS 69879 b

1    AN ACT concerning civil law.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the Tenant
5Protection Act.
 
6    Section 5. Findings; intent. The General Assembly finds and
7declares that the unique circumstances of the current housing
8crisis require a statewide response to address rent gouging by
9establishing statewide limitations on gross rental rate
10increases.
11    It is the intent of the General Assembly that this Act
12applies only for the limited time needed to address the current
13statewide housing crisis. This Act is not intended to expand or
14limit the authority of units of local government to establish
15local policies regulating rents, nor is it a statement
16regarding the appropriate, allowable rental rate increase when
17a local government adopts a policy regulating rent that is
18otherwise consistent with applicable law.
 
19    Section 10. Definitions. As used in this Act:
20    "Assisted housing development" has the meaning provided in
21subsection (e) of Section 3 of the Federally Assisted Housing
22Preservation Act.

 

 

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1    "Expiration of rental restrictions" means the expiration
2of rental restrictions for an assisted housing development
3unless the development has other recorded agreements
4restricting the rent to the same or lesser levels for at least
550% of the units.
6    "Owner" means any person, acting as principal or through an
7agent, having the right to offer residential real property for
8rent. "Owner" includes a predecessor in interest to the owner.
9"Owner" does not include the owner or operator of a mobile home
10park or the owner of a mobile home or his or her agent.
11    "Percentage change in the cost of living" means the
12percentage change from April 1 of the prior year to April 1 of
13the current year in the regional Consumer Price Index for the
14region where the residential real property is located, as
15published by the United States Bureau of Labor Statistics.
16    "Residential real property" means any dwelling or unit that
17is intended for human habitation.
18    "Substantially remodel" means the replacement or
19substantial modification of any structural, electrical,
20plumbing, or mechanical system that requires a permit from a
21governmental agency, or the abatement of hazardous materials,
22including lead-based paint, mold, or asbestos, in accordance
23with applicable federal, State, and local laws, that cannot be
24reasonably accomplished in a safe manner with the tenant in
25place and that requires the tenant to vacate the residential
26real property for at least 30 days. "Substantially remodel"

 

 

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1does not include cosmetic improvements alone, including
2painting, decorating, and minor repairs, or other work that can
3be performed safely without having the residential real
4property vacated.
5    "Tenancy" means the lawful occupation of residential real
6property and includes a lease or sublease.
 
7    Section 15. Termination of tenancy.
8    (a) Notwithstanding any other provision of law, after a
9tenant has continuously and lawfully occupied a residential
10real property for 12 months, the owner of the residential real
11property shall not terminate the tenancy without just cause,
12which shall be stated in the written notice to terminate the
13tenancy. If any additional tenant who is at least 18 years old
14is added to the lease before an existing tenant has
15continuously and lawfully occupied the residential real
16property for 24 months, this subsection only applies if:
17        (1) each tenant who is at least 18 years old has
18    continuously and lawfully occupied the residential real
19    property for at least 12 months; or
20        (2) at least one tenant who is at least 18 years old
21    has continuously and lawfully occupied the residential
22    real property for at least 24 months.
23    (b) For the purposes of this Section, "just cause"
24includes:
25        (1) At-fault just cause, including:

 

 

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1            (i) default in the payment of rent;
2            (ii) a breach of a material term of the lease,
3        including, but not limited to, the violation of a
4        provision of the lease after being issued a written
5        notice to correct the violation;
6            (iii) maintaining, committing, or permitting the
7        maintenance or commission of a nuisance;
8            (iv) committing waste;
9            (v) in the case of a tenant with a written lease
10        that terminated on or after January 1, 2021, after a
11        written request or demand from the owner, refusal by
12        the tenant to execute a written extension or renewal of
13        the lease for an additional term of similar duration
14        with similar provisions, as long as those terms do not
15        violate this Section or any other provision of law;
16            (vi) criminal activity by the tenant on the
17        residential real property, including any common areas,
18        or any criminal activity or criminal threat, on or off
19        the residential real property, that is directed at any
20        owner or agent of the owner of the residential real
21        property;
22            (vii) assigning or subletting the premises in
23        violation of the tenant's lease;
24            (viii) refusal of the tenant to allow the owner to
25        enter the residential real property;
26            (ix) using the premises for an unlawful purpose;

 

 

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1            (x) if the tenant is an employee, agent, or
2        licensee of the owner who was leased the residential
3        real property based on such status, failure by the
4        employee, agent, or licensee to vacate after his or her
5        termination as an employee, agent, or a licensee; or
6            (xi) failure to deliver possession of the
7        residential real property after providing the owner
8        written notice of the tenant's intention to terminate
9        the lease, or making a written offer to surrender that
10        is accepted in writing by the owner, but failing to
11        deliver possession at the time specified in that
12        written notice.
13        (2) No-fault just cause, including:
14            (i) intent to occupy the residential real property
15        by the owner, or his or her spouse, domestic partner,
16        child, grandchild, parent, or grandparent. For leases
17        entered into on or after July 1, 2021, this
18        subparagraph only applies if the tenant agrees, in
19        writing, to the termination, or if a provision of the
20        lease allows the owner to terminate the lease if the
21        owner, or his or her spouse, domestic partner, child,
22        grandchild, parent, or grandparent, unilaterally
23        decides to occupy the residential real property. The
24        addition of a provision allowing the owner to terminate
25        the lease as described in this subparagraph to a new or
26        renewed rental agreement or fixed-term lease

 

 

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1        constitutes a similar provision for the purposes of
2        subparagraph (v) of paragraph (1);
3            (ii) withdrawal of the residential real property
4        from the rental market;
5            (iii) the owner complying with:
6                (A) an order issued by a governmental agency or
7            court relating to habitability that necessitates
8            vacating the residential real property;
9                (B) an order issued by a governmental agency or
10            court to vacate the residential real property; or
11                (C) a local ordinance that necessitates
12            vacating the residential real property.
13            If it is determined by any governmental agency or
14        court that the tenant is at fault for the conditions
15        triggering the order or need to vacate under this
16        subparagraph, the tenant is not entitled to relocation
17        assistance under subsection (d); or
18            (iv) intent to demolish or to substantially
19        remodel the residential real property.
20    (c) Before an owner of residential real property issues a
21notice to terminate a tenancy for just cause that is a curable
22lease violation, the owner shall first give notice of the
23violation to the tenant with an opportunity to cure the
24violation. If the violation is not cured within the time set
25forth in the notice, a 3-day notice to quit without an
26opportunity to cure may thereafter be served to terminate the

 

 

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1tenancy.
2    (d) For a tenancy for which just cause is required to
3terminate the tenancy under subsection (a), if an owner of
4residential real property issues a termination notice based on
5a no-fault just cause described in paragraph (2) of subsection
6(b), the owner, at his or her option, regardless of the
7tenant's income, shall:
8        (1) assist the tenant to relocate by providing a direct
9    payment to the tenant as described in this subsection; or
10        (2) waive, in writing, the payment of rent for the
11    final month of the tenancy, prior to the rent becoming due.
12    If an owner issues a notice to terminate a tenancy for
13no-fault just cause, the owner shall notify the tenant of the
14tenant's right to relocation assistance or rent waiver under
15this Section. If the owner elects to waive the rent for the
16final month of the tenancy as provided in paragraph (2), the
17notice shall state the amount of rent waived and that no rent
18is due for the final month of the tenancy.
19    The amount of relocation assistance or rent waiver shall be
20equal to one month of the tenant's rent that was in effect when
21the owner issued the notice to terminate the tenancy. Any
22relocation assistance shall be provided within 15 calendar days
23of service of the notice. If a tenant fails to vacate after the
24expiration of the notice to terminate the tenancy, the actual
25amount of any relocation assistance or rent waiver provided
26under this subsection shall be recoverable as damages in an

 

 

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1action to recover possession. The relocation assistance or rent
2waiver required by this subsection shall be credited against
3any other relocation assistance required by any other law.
4    An owner's failure to strictly comply with this subsection
5shall render the notice of termination void.
6    (e) This Section does not apply to the following types of
7residential real properties or residential circumstances:
8        (1) Transient and tourist hotel occupancy.
9        (2) A housing accommodation in a nonprofit hospital,
10    religious facility, extended care facility, licensed
11    residential care facility for the elderly, or an adult
12    residential facility.
13        (3) A dormitory owned and operated by an institution of
14    higher education or a kindergarten and grades 1 through 12
15    school.
16        (4) A housing accommodation in which the tenant shares
17    bathroom or kitchen facilities with the owner who maintains
18    his or her principal residence at the residential real
19    property.
20        (5) A single-family owner-occupied residence,
21    including a residence in which the owner-occupant rents or
22    leases no more than 2 units or bedrooms, including, but not
23    limited to, an accessory dwelling unit or a junior
24    accessory dwelling unit.
25        (6) A duplex in which the owner occupies one of the
26    units as the owner's principal place of residence at the

 

 

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1    beginning of the tenancy, so long as the owner continues to
2    occupy the duplex as his or her principal place of
3    residence.
4        (7) Housing that has been issued a certificate of
5    occupancy within the previous 15 years.
6        (8) Residential real property that is alienable and
7    separate from the title to any other dwelling unit, if:
8            (i) the owner is not:
9                (A) a real estate investment trust, as defined
10            in Section 856 of the Internal Revenue Code;
11                (B) a corporation; or
12                (C) a limited liability company in which at
13            least one member is a corporation; and
14            (ii) the tenant has been provided written notice
15        that the residential property is exempt from this
16        Section using the following statement:
 
17            "This property is not subject to the just cause
18            requirements of Section 15 of the Tenant
19            Protection Act and is not subject to the rent
20            limits imposed by Section 20 of the Tenant
21            Protection Act. This property meets the
22            requirements of paragraph (8) of subsection (e) of
23            Section 15 and paragraph (5) of subsection (d) of
24            Section 20 of the Tenant Protection Act and the
25            owner is not: (1) a real estate investment trust,

 

 

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1            as defined by Section 856 of the Internal Revenue
2            Code; (2) a corporation; or (3) a limited liability
3            company in which at least one member is a
4            corporation."
 
5            For a tenancy existing before July 1, 2021, the
6        notice required under this subparagraph may be
7        provided in the rental agreement.
8            For any tenancy commenced or renewed on or after
9        July 1, 2021, the notice required under this
10        subparagraph shall be provided in the rental
11        agreement.
12            The addition of a provision containing the notice
13        required under this subparagraph to any new or renewed
14        rental agreement or fixed-term lease constitutes a
15        similar provision for the purposes of subparagraph (v)
16        of paragraph (1) of subsection (b).
17        (9) Housing restricted by deed, regulatory restriction
18    contained in an agreement with a governmental agency, or
19    other recorded document as affordable housing for persons
20    and families of very low, low, or moderate income, or
21    subject to an agreement that provides housing subsidies for
22    affordable housing for persons and families of very low,
23    low, or moderate income.
24    (f) An owner of residential real property subject to this
25Section shall provide notice to the tenant as follows:

 

 

SB3771- 11 -LRB101 20335 LNS 69879 b

1        (1) For any tenancy commenced or renewed on or after
2    July 1, 2021, as an addendum to the lease or rental
3    agreement, or as a written notice signed by the tenant,
4    with a copy provided to the tenant.
5        (2) For a tenancy existing prior to July 1, 2021, by
6    written notice to the tenant no later than August 1, 2021,
7    or as an addendum to the lease or rental agreement.
8        (3) The notification or lease provision shall include
9    the following:
 
10    "Illinois law limits the amount your rent can be increased.
11    See Section 20 of the Tenant Protection Act for more
12    information. Illinois law also provides that after each
13    tenant has continuously and lawfully occupied the property
14    for at least 12 months or at least one tenant has
15    continuously and lawfully occupied the property for at
16    least 24 months, a landlord shall provide a statement of
17    cause in any notice to terminate a tenancy. See Section 15
18    of the Tenant Protection Act for more information."
 
19    (g) This Section does not apply to the following
20residential real property:
21        (1) Residential real property subject to a local
22    ordinance requiring just cause for termination of a
23    residential tenancy adopted on or before September 1, 2020,
24    in which case the local ordinance shall apply.

 

 

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1        (2) Residential real property subject to a local
2    ordinance requiring just cause for termination of a
3    residential tenancy adopted or amended after September 1,
4    2020 that is more protective than this Section, in which
5    case the local ordinance shall apply. For purposes of this
6    paragraph, an ordinance is more protective if:
7            (i) the just cause for termination of a residential
8        tenancy under the local ordinance is consistent with
9        this Section;
10            (ii) the ordinance further limits the reasons for
11        termination of a residential tenancy, provides for
12        higher relocation assistance amounts, or provides
13        additional tenant protections that are not prohibited
14        by any other provision of law; and
15            (iii) the local government has made a finding
16        within its local ordinance that the ordinance is more
17        protective than the provisions of this Section.
18    A residential real property shall not be subject to both a
19local ordinance requiring just cause for termination of a
20residential tenancy and this Section.
21    A local ordinance adopted after September 1, 2020 that is
22less protective than this Section shall not be enforced unless
23this Section is repealed.
24    (h) Any waiver of the rights granted under this Section is
25against public policy and void.
 

 

 

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1    Section 20. Rental rates.
2    (a) Subject to subsection (b), an owner of residential real
3property shall not, over the course of any 12-month period,
4increase the gross rental rate for a dwelling or a unit more
5than 5% plus the percentage change in the cost of living, or
610%, whichever is lower, of the lowest gross rental rate
7charged for that dwelling or unit at any time during the 12
8months prior to the effective date of the increase. In
9determining the lowest gross rental amount under this Section,
10any rent discounts, incentives, concessions, or credits
11offered by the owner of the unit of residential real property
12and accepted by the tenant shall be excluded. The gross
13per-month rental rate and any owner-offered discounts,
14incentives, concessions, or credits shall be separately listed
15and identified in the lease or rental agreement or any
16amendments to an existing lease or rental agreement.
17    If the same tenant remains in occupancy of a unit of
18residential real property over any 12-month period, the gross
19rental rate for the unit of residential real property shall not
20be increased in more than 2 increments over that 12-month
21period, subject to the other restrictions of this subsection.
22    (b) For a new tenancy in which no tenant from the prior
23tenancy remains in lawful possession of the residential real
24property, the owner may establish the initial rental rate not
25subject to subsection (a). Subsection (a) applies only to
26subsequent increases after the initial rental rate has been

 

 

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1established.
2    (c) A tenant of residential real property subject to this
3Section shall not enter into a sublease that results in a total
4rent for the premises that exceeds the allowable rental rate
5authorized by subsection (a). Nothing in this subsection
6authorizes a tenant to sublet or assign the tenant's interest
7where otherwise prohibited.
8    (d) This Section does not apply to the following
9residential real properties:
10        (1) Housing restricted by deed, regulatory restriction
11    contained in an agreement with a governmental agency, or
12    other recorded document as affordable housing for persons
13    and families of very low, low, or moderate income, or
14    subject to an agreement that provides housing subsidies for
15    affordable housing for persons and families of very low,
16    low, or moderate income.
17        (2) A dormitory constructed and maintained in
18    connection with any higher education institution within
19    this State for use and occupancy by students in attendance
20    at the institution.
21        (3) Housing subject to rent or price control through a
22    public entity's valid exercise of its police power that
23    restricts annual increases in the rental rate to an amount
24    less than that provided in subsection (a).
25        (4) Housing that has been issued a certificate of
26    occupancy within the previous 15 years.

 

 

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1        (5) Residential real property that is alienable and
2    separate from the title to any other dwelling unit, if:
3            (i) the owner is not:
4                (A) a real estate investment trust, as defined
5            in Section 856 of the Internal Revenue Code;
6                (B) a corporation; or
7                (C) a limited liability company in which at
8            least one member is a corporation; and
9            (ii) the tenant has been provided written notice
10        that the residential real property is exempt from this
11        Section using the following statement:
 
12            "This property is not subject to the just cause
13            requirements of Section 15 of the Tenant
14            Protection Act and is not subject to the rent
15            limits imposed by Section 20 of the Tenant
16            Protection Act. This property meets the
17            requirements of paragraph (8) of subsection (e) of
18            Section 15 and paragraph (5) of subsection (d) of
19            Section 20 of the Tenant Protection Act and the
20            owner is not: (1) a real estate investment trust,
21            as defined by Section 856 of the Internal Revenue
22            Code; (2) a corporation; or (3) a limited liability
23            company in which at least one member is a
24            corporation."
 

 

 

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1            For a tenancy existing before July 1, 2021, the
2        notice required under this subparagraph may be
3        provided in the rental agreement.
4            For a tenancy commenced or renewed on or after July
5        1, 2021, the notice required under this subparagraph
6        shall be provided in the rental agreement.
7            The addition of a provision containing the notice
8        required under this subparagraph to any new or renewed
9        rental agreement or fixed-term lease constitutes a
10        similar provision for the purposes of subparagraph (v)
11        of paragraph (1) of subsection (b) of Section 15.
12        (6) A duplex in which the owner occupies one of the
13    units as the owner's principal place of residence at the
14    beginning of the tenancy, so long as the owner continues to
15    occupy the duplex as his or her principal place of
16    residence.
17    (e) An owner shall provide notice of any increase in the
18rental rate, pursuant to subsection (a), to each tenant.
19    (f) On or before January 1, 2031, the Commission on
20Government Forecasting and Accountability shall report to the
21General Assembly regarding the effectiveness of this Act. The
22report shall include, but not be limited to, the impact of the
23rental rate cap pursuant to subsection (a) on the housing
24market within this State.
25    (g) This Section applies to all rent increases subject to
26subsection (a) occurring on or after March 15, 2020. This

 

 

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1Section shall become operative January 1, 2021.
2    If an owner has increased the rent by more than the amount
3permissible under subsection (a) between March 15, 2020, and
4January 1, 2021, the following applies:
5        (1) the applicable rent on January 1, 2021, shall be
6    the rent as of March 15, 2020, plus the maximum permissible
7    increase under subsection (a); and
8        (2) an owner is not liable to the tenant for any
9    corresponding rent overpayment.
10    An owner of residential real property subject to subsection
11(a) who increased the rental rate on that residential real
12property on or after March 15, 2020, but prior to January 1,
132021, by an amount less than the rental rate increase permitted
14by subsection (a) is allowed to increase the rental rate twice,
15as provided in paragraph (2) of subsection (a), within 12
16months of March 15, 2020, but in no event shall that rental
17rate increase exceed the maximum rental rate increase permitted
18by subsection (a).
19    (h) Any waiver of the rights granted under this Section is
20against public policy and void.
21    (i) Nothing in this Section affects the existing authority
22of a unit of local government to adopt or maintain rent
23controls or price controls consistent with this Act.
 
24    Section 25. Exceptions.
25    (a) Notwithstanding Section 20, upon the expiration of

 

 

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1rental restrictions, the following applies:
2        (1) The owner of an assisted housing development who
3    demonstrates, under penalty of perjury, compliance with
4    any other applicable law or regulation intended to promote
5    the preservation of assisted housing, may establish the
6    initial unassisted rental rate for units in the applicable
7    housing development. Any subsequent rent increase in the
8    development shall is subject to Section 20.
9        (2) The owner of a deed-restricted affordable housing
10    unit or an affordable housing unit subject to a regulatory
11    restriction contained in an agreement with a governmental
12    agency limiting rental rates that is not within an assisted
13    housing development may establish the initial rental rate
14    for the unit upon the expiration of the restriction. Any
15    subsequent rent increase for the unit is subject to Section
16    20.
17    (b) Any waiver of the rights under this Section is against
18public policy and void.
 
19    Section 30. Repeal. This Act is repealed on January 1,
202031.
 
21    Section 99. Effective date. This Act takes effect upon
22becoming law.