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92_HB3140eng HB3140 Engrossed LRB9203244MWdvB 1 AN ACT in relation to home equity programs. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The Home Equity Assurance Act is amended by 5 changing Section 3 and by adding Section 4.3 as follows: 6 (65 ILCS 95/3) (from Ch. 24, par. 1603) 7 Sec. 3. Definitions. For the purposes of this Act: 8 (a) "Bona fide offer" means an offer made in good faith 9 and for a valuable consideration to purchase a qualified 10 residence. 11 (b) "Certificate of participation" means the duly 12 notarized document of membership in a program, signed by the 13 qualified applicant and by an authorized representative of 14 the governing commission, which specifies the location and 15 description of the guaranteed residence, its guaranteed 16 value, the registration date, and which has attached a 17 program appraisal for the guaranteed residence. 18 (c) "Community organization" means a not-for-profit 19 organization which has been registered with this State for at 20 least 5 years as a not-for-profit organization, which 21 qualifies for tax exempt status under Section 501 (c) (3) or 22 501 (c) (4) of the United States Internal Revenue Code of 23 1986, as now or hereafter amended, which continuously 24 maintains an office or business location within the territory 25 of a program together with a current listed telephone number, 26 and whose members reside within the territory of a program. 27 (d) "Eligible applicant" means a natural person who is 28 the owner of a qualified residence within the territory of a 29 program who continuously occupies or has a family member who 30 occupies such qualified residence as the principal place of 31 residence. HB3140 Engrossed -2- LRB9203244MWdvB 1 (e) "Family member" means a spouse, child, stepchild, 2 parent, grandparent, brother, sister, or any such relations 3 of the spouse of the member. 4 (f) "Governing commission" means the 9 member (or 18 5 member in the case of a merged program or the number of 6 members required under Section 4.3 in the case of the 7 transfer of territory between programs) governing body which 8 is authorized by voter approval of the creation of a home 9 equity program (or merger of programs or transfer of 10 territory between programs) as provided in this Act. The 11 members shall beand which isappointed by the mayor of the 12 municipality in which the program has been approved with the 13 approval of the city council. Seven members, 7(or 14 in the 14 case of a merged program) of the commission and any members 15 appointed under Section 4.3whomshall be appointed from a 16 list or lists of nominees submitted by a community 17 organization or community organizations as defined in this 18 Act. 19 (g) "Gross selling value" means the total consideration 20 to be paid for the purchase of a guaranteed residence, and 21 shall include any amount that the buyer or prospective buyer 22 agrees to assume on behalf of a member, including broker 23 commissions, points, legal fees, personal financing, or other 24 items of value involved in the sale. 25 (h) "Guarantee fund" means the funds collected under the 26 provisions of this Act for the purpose of guaranteeing the 27 property values of members within the territory of a program. 28 (i) "Guaranteed residence" means a qualified residence 29 for which a certificate of participation has been issued, 30 which is occupied continuously as the place of legal 31 residence by the member or a family member, which is 32 described in the certificate of participation, and which is 33 entitled to coverage under this Act. 34 (j) "Guaranteed value" means the appraised valuation HB3140 Engrossed -3- LRB9203244MWdvB 1 based upon a standard of current fair market value as of the 2 registration date on the qualified residence as determined by 3 a program appraiser pursuant to accepted professional 4 appraisal standards and which is authorized by the commission 5 for the registration date. The guaranteed value shall be 6 used solely by the commission for the purpose of 7 administering the program and shall remain confidential. 8 (k) "Member" means the owner of a guaranteed residence. 9 (l) "Owner" means a natural person who is the legal 10 titleholder or who is the beneficiary of a trust which is the 11 legal titleholder. 12 (m) "Physical perils" means physical occurrences such 13 as, but not limited to, fire, windstorm, hail, nuclear 14 explosion or seepage, war, insurrection, wear and tear, 15 cracking, settling, vermin, rodents, insects, vandalism, 16 pollution or contamination, and all such related occurrences 17 or acts of God. 18 (n) "Program" means the guaranteed home equity program 19 governed by a specific home equity commission. 20 (o) "Program appraisal" means a real estate appraisal 21 conducted by a program appraiser for the purpose of 22 establishing the guaranteed value of a qualified residence 23 under a program and providing a general description of the 24 qualified residence. The program appraisal shall be used 25 solely by the governing commission for the purpose of 26 administering the program and shall remain confidential. 27 (p) "Program appraiser" means a real estate appraiser 28 who meets the professional standards established by the 29 American Institute of Real Estate Appraisers (AIREA), the 30 National Association of Independent Fee Appraisers (NAIFA), 31 the National Society of Real Estate Appraisers (NSREA) or the 32 American Society of Appraisers (ASA) and whose name is 33 submitted to the governing commission by the appraiser to 34 conduct program appraisals under the provisions of a program. HB3140 Engrossed -4- LRB9203244MWdvB 1 (q) "Program guidelines" means those policies, rules, 2 regulations, and bylaws established from time to time by the 3 governing commission to explain, clarify, or modify the 4 program in order to fulfill its goals and objectives. 5 (r) "Qualified residence" means a building: (1) located 6 in the territory of a program having at least one, but not 7 more than 6, dwelling units; (2) classified by county 8 ordinance as residential and assessed for property tax 9 purposes; and (3) with at least one dwelling unit 10 continuously occupied as the principal legal residence of a 11 member or family member. 12 (s) "Registration date" means the date of receipt by the 13 governing commission of the registration fee and a completed 14 application of a qualified applicant for participation in a 15 program. 16 (t) "Registration fee" means the fee which is 17 established by the governing commission to defray the cost of 18 a program appraisal on a qualified residence. 19 (Source: P.A. 86-684.) 20 (65 ILCS 95/4.3 new) 21 Sec. 4.3. Transfer of territory. 22 (a) In a municipality with more than 1,000,000 23 inhabitants, territory may be transferred from one existing 24 home equity program to another existing, contiguous home 25 equity program. The question of transferring territory must 26 be initiated by a petition signed by not less than 10% of the 27 total number of registered voters who are eligible to sign 28 the petition who are residing in the territory to be 29 transferred and either (i) a resolution or ordinance of the 30 governing commission of the program to which the territory 31 will be transferred or (ii) a petition signed by not less 32 than 10% of the total number of registered voters eligible to 33 sign the petition who are residing in the geographic area of HB3140 Engrossed -5- LRB9203244MWdvB 1 the program to which the territory will be transferred. It is 2 the duty of the election authority having jurisdiction over 3 the municipality to submit the question of transferring 4 territory to the electors of the program to which the 5 territory is being transferred and the electors residing in 6 the territory to be transferred at the regular election 7 specified in the resolution, ordinance, or petition 8 initiating the question. A petition initiating the question 9 described in this Section must be filed with the election 10 authority having jurisdiction over the municipality. The 11 petition must be filed and objections to the petition must be 12 made in the manner provided in the Election Code. A 13 resolution, ordinance, or petition initiating a question 14 described in this Section must specify the election at which 15 the question is to be submitted. The referendum on the 16 question must be held in accordance with the Election Code. 17 The question, and the resolution, ordinance, or petition 18 initiating the question, must include a description of the 19 territory to be transferred and the maximum rate at which a 20 property tax may be levied on the taxable property in the 21 transferred territory. All of the geographic area of the 22 territory described in the question shall be transferred, and 23 no area outside of the geographic boundaries of the territory 24 described in the question may be transferred. If the 25 election authority determines that the description cannot be 26 included within the space limitations of the ballot, the 27 election authority must prepare large printed copies of a 28 notice of the question that must be prominently displayed in 29 the polling place of each precinct in which the question is 30 to be submitted. 31 (b) All proceedings and meetings of the governing 32 commission must be conducted in accordance with the Open 33 Meetings Act. 34 Upon the transfer of territory from one program to HB3140 Engrossed -6- LRB9203244MWdvB 1 another, the members in the transferred territory are members 2 of the program to which the territory is transferred. Any 3 registration fee required by the program to which the 4 territory is transferred for new members must be waived with 5 respect to transferred members. Program appraisals of a 6 transferred member's property must be accepted by the program 7 to which the territory is transferred. The program to which 8 the territory is transferred, including the transferred 9 territory, shall be operated as a single program. 10 (c) When transferred territory is added to a program, an 11 additional commissioner who is a resident of the transferred 12 territory must be appointed by the mayor from a list of 13 nominees submitted by a community organization or community 14 organizations, as defined in this Act, to the governing 15 commisson of the program to which the territory is 16 transferred. A community organization's list may not 17 recommend more than 3 individuals. 18 If the total number of registered voters in the 19 transferred territory exceeds 20% of the total number of 20 registered voters in the geographic area of the program to 21 which the territory was transferred as it existed before the 22 transfer, then 2 additional commissioners who are residents 23 of the transferred territory must be appointed. For each 24 additional increase of 10% of the total number of registered 25 voters in the transferred territory as compared to the total 26 number of registered voters in the geographic area of the 27 program to which the territory was transferred as it existed 28 before the transfer, an additional commissioner who is a 29 resident of the transferred territory must be appointed. A 30 community organization may recommend not more than 3 31 individuals for the office of each additional commissioner. 32 The commissioner or commissioners representing the 33 transferred territory shall serve an initial term of 3 years. 34 Successors shall be appointed for a 3-year term or until HB3140 Engrossed -7- LRB9203244MWdvB 1 their successors are appointed and qualified. No 2 commissioner may serve more than 2 consecutive terms. A 3 vacancy in the office of commissioner shall be filled in the 4 same manner as the original appointment.