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91_HB2180enr HB2180 Enrolled LRB9103277PTpk 1 AN ACT to amend the Property Tax Code by changing 2 Sections 21-295, 21-305, 21-345, and 22-40 and adding 3 Sections 21-306 and 21-397. 4 Be it enacted by the People of the State of Illinois, 5 represented in the General Assembly: 6 Section 5. The Property Tax Code is amended by changing 7 Sections 21-295, 21-305, 21-345, and 22-40 and adding 8 Sections 21-306 and 21-397 as follows: 9 (35 ILCS 200/21-295) 10 Sec. 21-295. Creation of indemnity fund. 11 (a) In counties of less than 3,000,000 inhabitants, each 12 person purchasing any property at a sale under this Code 13 shall pay to the County Collector, prior to the issuance of 14 any certificate of purchase, a fee of $20 for each item 15 purchasedin counties of less than 3,000,000 inhabitants and16$80 in counties of 3,000,000 or more inhabitants.In all17counties,A like sum shall be paid for each year that all or 18 a portion ofan installment ofsubsequent taxes, or portion19thereof isare paid by the tax purchaser and posted to the 20 tax judgment, sale, redemption and forfeiture record where 21 the underlying certificate of purchase is recorded.The22amount paid prior to issuance of the certificate of purchase23shall be included in the purchase price of the property in24the certificate of purchase and all amounts paid under this25subsection shall be included in the amount required to redeem26under Section 21-355.27 (a-5) In counties of 3,000,000 or more inhabitants, each 28 person purchasing property at a sale under this Code shall 29 pay to the County Collector a fee of $80 for each item 30 purchased plus an additional sum equal to 5% of total taxes, 31 interest, and penalties, including the taxes, interest, and HB2180 Enrolled -2- LRB9103277PTpk 1 penalties paid under Section 21-240. In these counties, the 2 certificate holder shall also pay to the County Collector a 3 fee of $80 for each year that all or a portion of subsequent 4 taxes are paid by the tax purchaser and posted to the tax 5 judgment, sale, redemption, and forfeiture record, plus an 6 additional sum equal to 5% of all subsequent taxes, interest, 7 and penalties. The additional 5% fee is not required after 8 December 31, 2006. 9 (b) The amount paid prior to issuance of the certificate 10 of purchase pursuant to subsection (a) or (a-5) shall be 11 included in the purchase price of the property in the 12 certificate of purchase and all amounts paid under this 13 Section shall be included in the amount required to redeem 14 under Section 21-355. Except as otherwise provided in 15 subsection (b) of Section 21-300, all money received under 16 subsection (a) or (a-5) shall be paid by the Collector to the 17 County Treasurer of the County in which the land is situated, 18 for the purpose of an indemnity fund. The County Treasurer, 19 as trustee of that fund, shall invest all of that fund, 20 principal and income, in his or her hands from time to time, 21 if not immediately required for payments of indemnities under 22 subsection (a) of Section 21-305, in investments permitted by 23 the Illinois State Board of Investment under Article 22A of 24 the Illinois Pension Code. The county collector shall report 25 annually to the Circuit Court on the condition and income of 26 the fund. The indemnity fund shall be held to satisfy 27 judgments obtained against the County Treasurer, as trustee 28 of the fund. No payment shall be made from the fund, except 29 upon a judgment of the court which ordered the issuance of a 30 tax deed. 31 (Source: P.A. 86-1028; 86-1431; 88-455.) 32 (35 ILCS 200/21-305) 33 Sec. 21-305. Payments from Indemnity Fund. HB2180 Enrolled -3- LRB9103277PTpk 1 (a) Any owner of property sold under any provision of 2 this Code who sustains loss or damage by reason of the 3 issuance of a tax deed under Section 21-445 or 22-40 and who 4 is barred or is in any way precluded from bringing an action 5 for the recovery of the property shall have the right to 6 indemnity for the loss or damage sustained, limited as 7 follows: 8 (1) An owner who resided on property that contained 9 4 or less dwelling units on the last day of the period of 10 redemption and who is equitably entitled to compensation 11 for the loss or damage sustained has the right to 12 indemnity. An equitable indemnity award shall be limited 13 to the fair cash value of the property as of the date the 14 tax deed was issued less any mortgages or liens on the 15 property, and the award will not exceed $99,000. The 16 Court shall liberally construe this equitable entitlement 17 standard to provide compensation wherever, in the 18 discretion of the Court, the equities warrant the action. 19 An owner of a property that contained 4 or less 20 dwelling units who requests an award in excess of $99,000 21 must prove that the loss of his or her property was not 22 attributable to his or her own fault or negligence before 23 an award in excess of $99,000 will be granted. 24 (2) An owner who sustains the loss or damage of any 25 property occasioned by reason of the issuance of a tax 26 deed, without fault or negligence of his or her own, has 27 the right to indemnity limited to the fair cash value of 28 the property less any mortgages or liens on the 29 property. In determining the existence of fault or 30 negligence, the court shall consider whether the owner 31 exercised ordinary reasonable diligence under all of the 32 relevant circumstances. 33 (3) In determining the fair cash value of property 34 less any mortgages or liens on the property, the fair HB2180 Enrolled -4- LRB9103277PTpk 1 cash value shall be reduced by the principal amount of 2 all taxes paid by the tax purchaser or his or her 3 assignee before the issuance of the tax deed. 4 (4) If an award made under paragraph (1) or (2) is 5 subject to a reduction by the amount of an outstanding 6 mortgage or lien on the property, other than the 7 principal amount of all taxes paid by the tax purchaser 8 or his or her assignee before the issuance of the tax 9 deed and the petitioner would be personally liable to the 10 mortgagee or lienholder for all or part of that reduction 11 amount, the court shall order an additional indemnity 12 award to be paid directly to the mortgagee or lienholder 13 sufficient to discharge the petitioner's personal 14 liability. The court, in its discretion, may order the 15 joinder of the mortgagee or lienholder as an additional 16 party to the indemnity action.Any owner of property sold17under any provision of this Code, who without fault or18negligence of his or her own sustains loss or damage by19reason of the issuance of a tax deed under Sections 22-4020or 21-445 and who is barred or in any way precluded from21bringing an action for the recovery of the property or22any owner of property containing 4 or less dwelling units23who resided thereon the last day of the period of24redemption who, in the opinion of the Court which issued25the tax deed order, is equitably entitled to just26compensation, has the right to indemnity for the loss or27damage sustained. Indemnity shall be limited to the fair28cash value of the property as of the date that the tax29deed was issued, less any mortgages or liens thereon.30 (b) Indemnity fund; subrogation. 31 (1) Any person claiming indemnity hereunder shall 32 petition the Court which ordered the tax deed to issue, 33 shall name the County Treasurer, as Trustee of the 34 indemnity fund, as defendant to the petition, and shall HB2180 Enrolled -5- LRB9103277PTpk 1 ask that judgment be entered against the County 2 Treasurer, as Trustee, in the amount of the indemnity 3 sought. The provisions of the Civil Practice Law shall 4 apply to proceedings under the petition, except that 5 neither the petitioner nor County Treasurer shall be 6 entitled to trial by jury on the issues presented in the 7 petition. The Court shall liberally construe this Section 8 to provide compensation wherever in the discretion of the 9 Court the equities warrant such action. 10 (2) The County Treasurer, as Trustee of the 11 indemnity fund, shall be subrogated to all parties in 12 whose favor judgment may be rendered against him or her, 13 and by third party complaint may bring in as a defendant 14 anyaperson, other than the tax deed grantee and its 15 successors in title, not a party to the action who is or 16 may be liable to him or her, as subrogee, for all or part 17 of the petitioner's claim against him or her. 18 (c) Any contract involving the proceeds of a judgment 19 for indemnity under this Section, between the tax deed 20 grantee or its successors in title and the indemnity 21 petitioner or his or her successors, shall be in writing. In 22 any action brought under Section 21-305, the Collector shall 23 be entitled to discovery regarding, but not limited to, the 24 following: 25 (1) the identity of all persons beneficially 26 interested in the contract, directly or indirectly, 27 including at least the following information: the names 28 and addresses of any natural persons; the place of 29 incorporation of any corporation and the names and 30 addresses of its shareholders unless it is publicly held; 31 the names and addresses of all general and limited 32 partners of any partnership; the names and addresses of 33 all persons having an ownership interest in any entity 34 doing business under an assumed name, and the county in HB2180 Enrolled -6- LRB9103277PTpk 1 which the assumed business name is registered; and the 2 nature and extent of the interest in the contract of each 3 person identified; 4 (2) the time period during which the contract was 5 negotiated and agreed upon, from the date of the first 6 direct or indirect contact between any of the contracting 7 parties to the date of its execution; 8 (3) the name and address of each natural person who 9 took part in negotiating the contract, and the identity 10 and relationship of the party that the person represented 11 in the negotiations; and 12 (4) the existence of an agreement for payment of 13 attorney's fees by or on behalf of each party. 14 Any information disclosed during discovery may be subject 15 to protective order as deemed appropriate by the court. The 16 terms of the contract shall not be used as evidence of value. 17 18 (Source: P.A. 86-1028; 86-1431; 88-455.) 19 (35 ILCS 200/21-306 new) 20 Sec. 21-306. Indemnity fund fraud. 21 (a) A person commits the offense of indemnity fund fraud 22 when that person knowingly: 23 (1) offers or agrees to become a party to, or to 24 acquire an interest in, a contract involving the proceeds 25 of a judgment for indemnity under Section 21-305 before 26 the end of the period of redemption from the tax sale to 27 which the judgment relates; 28 (2) fraudulently induces a party to forego bringing 29 an action for the recovery of the property; 30 (3) makes a deceptive misrepresentation during the 31 course of negotiating an agreement under subsection (c) 32 of Section 21-305; or 33 (4) conspires to violate any of the provisions of HB2180 Enrolled -7- LRB9103277PTpk 1 this subsection. 2 (b) Commission of any one act described in subsection 3 (a) is a Class A misdemeanor. Commission of more than one act 4 described in subsection (a) during a single course of conduct 5 is a Class 4 felony. A second or subsequent conviction for 6 violation of any portion of this Section is a Class 4 felony. 7 (c) The State's Attorney of the county in which a 8 judgment for indemnity under Section 21-305 is entered may 9 bring a civil action in the name of the People of the State 10 of Illinois against a person who violates paragraph (1), (2), 11 or (3) of subsection (a). Upon a finding of liability in the 12 action the court shall enter judgment in favor of the People 13 in a sum equal to three times the amount of the judgment for 14 indemnity, together with costs of the action and reasonable 15 attorney's fees. The proceeds of any judgment under this 16 subsection shall be paid into the general fund of the county. 17 18 (35 ILCS 200/21-345) 19 Sec. 21-345. Right of redemption. 20 (a) Property sold under this Code may be redeemed only 21 by those persons having a right of redemption as defined in 22 this Section and only in accordance with this Code. 23 A right to redeem property from any sale under this Code 24 shall exist in any owner or person interested in that 25 property, other than an undisclosed beneficiary of an 26 Illinois land trust, whether or not the interest in the 27 property sold is recorded or filed. Any redemption shall be 28 presumed to have been made by or on behalf of the owners and 29 persons interested in the property and shall inure to the 30 benefit of the persons having the legal or equitable title to 31 the property redeemed, subject to the right of the person 32 making the redemption to be reimbursed by the persons 33 benefited. No redemption shall be held invalid by reason of 34 the failure of the person redeeming to have recorded or filed HB2180 Enrolled -8- LRB9103277PTpk 1 the document evidencing an interest in the property prior to 2 redemption, other than an undisclosed beneficiary of an 3 Illinois land trust. 4 (b) Any person who desires to redeem and does not desire 5 to contest the validity of a petition for tax deed may redeem 6 pursuant to this Section and related Sections of this Code 7 without submitting a written protest under Section 21-380. 8 This subsection (b) shall be construed as declarative of 9 existing law and not as a new enactment. 10 (Source: P.A. 86-286; 86-413; 86-418; 86-949; 86-1028; 11 86-1158; 86-1481; 87-145; 87-236; 87-435; 87-895; 87-1189; 12 88-455.) 13 (35 ILCS 200/21-397 new) 14 Sec. 21-397. Notice of order setting aside redemption. In 15 counties with 3,000,000 or more inhabitants, if an order is 16 entered setting aside a redemption made within the time 17 allowed by law after a petition for tax deed has been filed, 18 the holder of the certificate of purchase shall mail a copy 19 of the order within 7 days of entry of the order by 20 registered or certified mail to the county clerk, to the 21 person who made the redemption, and to all parties entitled 22 to notice of the petition under Section 22-10, 22-15, or 23 22-25. The order shall provide that any person who was 24 entitled to redeem may pay to the county clerk within 30 days 25 after the entry of the order the amount necessary to redeem 26 the property from the sale as of the last day of the period 27 of redemption. The county clerk shall make an entry in the 28 annual tax judgment, sale, redemption, and forfeiture record 29 reflecting the entry of the order and shall immediately upon 30 request provide an estimate of the amount required to effect 31 a redemption as of the last date of the period of redemption. 32 If the amount is paid within 30 days after entry of the 33 order, then the court shall enter an order declaring the HB2180 Enrolled -9- LRB9103277PTpk 1 taxes to be paid as if the property had been redeemed within 2 the time required by law and dismissing the petition for tax 3 deed. A tax deed shall not be issued within the 30-day 4 period. Upon surrender of the certificate of purchase, the 5 county clerk shall distribute the funds deposited as if a 6 timely redemption had been made. This Section applies to all 7 redemptions that occur after the effective date of this 8 amendatory Act of the 91st General Assembly. 9 (35 ILCS 200/22-40) 10 Sec. 22-40. Issuance of deed; possession. 11 (a) If the redemption period expires and the property 12 has not been redeemed and all taxes and special assessments 13 which became due and payable subsequent to the sale have been 14 paid and all forfeitures and sales which occur subsequent to 15 the sale have been redeemed and the notices required by law 16 have been given and all advancements of public funds under 17 the police power made by a city, village or town under 18 Section 22-35 have been paid and the petitioner has complied 19 with all the provisions of law entitling him or her to a 20 deed, the court shall so find and shall enter an order 21 directing the county clerk on the production of the 22 certificate of purchase and a certified copy of the order, to 23 issue to the purchaser or his or her assignee a tax deed. 24 The court shall insist on strict compliance with Section 25 22-10 through 22-25. Prior to the entry of an order 26 directing the issuance of a tax deed, the petitioner shall 27 furnish the court with a report of proceedings of the 28 evidence received on the application for tax deed and the 29 report of proceedings shall be filed and made a part of the 30 court record. 31 (b) If taxes for years prior to the year sold remain 32 delinquent at the time of the tax deed hearing, those 33 delinquent taxes may be merged into the tax deed if the court HB2180 Enrolled -10- LRB9103277PTpk 1 determines that all other requirements for receiving an order 2 directing the issuance of the tax deed are fulfilled and 3 makes a further determination under either paragraph (1) or 4 (2). 5 (1) Incomplete estimate. 6 (A) The property in question was purchased at 7 an annual sale; and 8 (B) the statement and estimate of forfeited 9 general taxes furnished by the county clerk pursuant 10 to Section 21-240 failed to include all delinquent 11 taxes as of the date of that estimate's issuance. 12 (2) Vacating order. 13 (A) The petitioner furnishes the court with a 14 certified copy of an order vacating a prior sale for 15 the subject property; 16 (B) the order vacating the sale was entered 17 after the date of purchase for the subject taxes; 18 (C) the sale in error was granted pursuant to 19 paragraphs (1), (2), or (4) of subsection (b) of 20 Section 21-310 or Section 22-35; and 21 (D) the tax purchaser who received the sale in 22 error has no affiliation, direct or indirect, with 23 the petitioner in the present proceeding and that 24 petitioner has signed an affidavit attesting to the 25 lack of affiliation. 26 If delinquent taxes are merged into the tax deed pursuant to 27 this subsection, a declaration to that effect shall be 28 included in the order directing issuance of the tax deed. 29 Nothing contained in this Section shall relieve any owner 30 liable for delinquent property taxes under this Code from the 31 payment of the taxes that have been merged into the title 32 upon issuance of the tax deed. 33 (c) The county clerk is entitled to a fee of $10 in 34 counties of 3,000,000 or more inhabitants and $5 in counties HB2180 Enrolled -11- LRB9103277PTpk 1 with less than 3,000,000 inhabitants for the issuance of the 2 tax deed. The clerk may not include in a tax deed more than 3 one property as listed, assessed and sold in one 4 description, except in cases where several properties are 5 owned by one person. 6 Upon application the court shall, enter an order to place 7 the tax deed grantee in possession of the property and may 8 enter orders and grant relief as may be necessary or 9 desirable to maintain the grantee in possession. 10 (Source: P.A. 86-1158; 86-1431; 86-1475; 87-145; 87-669; 11 87-671; 87-895; 87-1189; 88-455.) 12 Section 99. Effective date. This Act takes effect upon 13 becoming law.