State of Illinois
2007 and 2008


Introduced 2/7/2007, by Sen. John J. Cullerton


765 ILCS 605/18.7 new
30 ILCS 105/5.675 new

    Amends the Condominium Property Act. Requires licensing of managers of community associations. Creates the Community Association Manager Regulatory Commission, whose members are appointed by the Governor, to administer the licensing. Requires the payment of fees. Sets forth licensing requirements. Provides for discipline and other matters. Amends the State Finance Act to create a special fund. Effective July 1, 2009.

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1     AN ACT concerning property.
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4     Section 5. The Condominium Property Act is amended by
5 adding Section 18.7 as follows:
6     (765 ILCS 605/18.7 new)
7     Sec. 18.7. Licensing of managers of community
8 associations.
9     (a) Legislative declaration. It is declared to be in the
10 best interest of the citizens of the State of Illinois and a
11 proper exercise of the police power of the State of Illinois to
12 provide for the regulation of managers of community
13 associations, who hold themselves out as possessing
14 professional qualifications as managers of community
15 associations and are, in fact, qualified to render management
16 services of a professional nature, and to provide for the
17 maintenance of high standards of professional conduct by those
18 licensed as managers of community associations. Because of the
19 customary reliance by the public, specifically the duly
20 appointed or elected governing body of common interest
21 community associations, upon the financial, supervisory, and
22 managerial services of persons purporting to possess expert
23 knowledge in the field of community association management and



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1 as custodian of community association funds, it is further
2 declared to be in the best interest of Illinois citizens to
3 limit and restrict, under the circumstances set forth in this
4 Section, the issuance of licenses to community association
5 managers who have been certified to possess the necessary
6 knowledge in the relevant financial, managerial, and
7 supervisory services, or compliance with conditions
8 established by law or contract of persons so licensed.
9     (b) Definitions. As used in this Section, unless the
10 context otherwise requires:
11         "License" means the license issued to a manager of
12     community associations for the State.
13         "License holder" means a person to whom a license has
14     been issued.
15         "Commission" means the Community Associations Manager
16     Regulatory Commission.
17         "Community association" means an association in which
18     membership is a condition of ownership or shareholder
19     interest of a unit in a condominium, cooperative,
20     townhouse, villa, or other residential unit that is part of
21     a residential development plan and that is authorized to
22     impose an assessment and other costs that may become a lien
23     on the unit or lot.
24         "Community association manager" means an individual
25     who administers for compensation the coordination of
26     financial, administrative, maintenance, or other duties



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1     called for in the management contract, including
2     individuals who are direct employees of a community
3     association. A manager does not include support staff, such
4     as bookkeepers, administrative assistants, secretaries,
5     property inspectors, customer service representatives, or
6     managers in training.
7         "Manager in training" means any individual who is
8     training to become a manager and is under the supervision
9     of a license holder. During the training period, a manager
10     in training may not be licensed. A manager in training
11     shall not have signatory authority on any community
12     association bank account. Further, after a period of one
13     year, a manager in training is required to be licensed by
14     the State.
15     (c) License requirement. In order to provide community
16 association management services to community associations in
17 Illinois, individuals must possess a license issued by the
18 Community Association Manager Regulatory Commission.
19     (d) Community Association Manager Regulatory Commission.
20         (1) The Community Association Manager Regulatory
21     Commission shall consist of 9 members appointed by the
22     Governor, with the advice and consent of the Senate, and
23     who shall have been residents of the State of Illinois for
24     5 years prior to the date of appointment.
25         (2) Seven members of the Commission shall be license
26     holders and residents of Illinois. Until the license



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1     program has been established and grants licenses, these
2     members must hold the qualifications to be license holders.
3     Each of the remaining 2 members shall be a member who does
4     not hold a license and shall be an owner or shareholder of
5     a unit in a common interest community association at the
6     time of his or her appointment.
7         (3) Initially, 5 members shall serve for 5-year terms
8     and 4 members for 4-year terms. Thereafter, terms shall be
9     for 5 years. Upon expiration of his or her term of office,
10     a member shall serve until his or her successor is
11     appointed. Any vacancy occurring during a term shall be
12     filled by appointment by the Governor, with the advice and
13     consent of the Senate, for the unexpired term. The Governor
14     shall remove from the Commission any member whose license
15     has become void or has been revoked or suspended and may
16     remove any member of the Commission for neglect of duty,
17     misconduct, or incompetence.
18         (4) The presence of two-thirds of the full Commission
19     shall constitute a quorum for the transaction of business.
20     Action shall be taken only upon the majority vote of a
21     quorum, except regarding disciplinary actions which shall
22     require a unanimous vote of a quorum.
23         (5) The provisions of Illinois law concerning the
24     termination schedule for regulatory bodies of the State of
25     Illinois are applicable to the Commission created by this
26     Section.



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1         (6) Any member of the Commission, any attorney
2     providing advice to the Commission, any person acting as a
3     consultant to the Commission, and any witness testifying in
4     a proceeding authorized under this Act, excluding the party
5     making the complaint, is immune from liability in any civil
6     action brought against him or her for acts occurring while
7     acting in his or her capacity as a commissioner,
8     consultant, or witness, if the individual was acting in
9     good faith within the scope of his or her respective
10     capacity, made a reasonable effort to obtain the facts of
11     the matter as to which he or she acted, and acted in the
12     reasonable belief that the action taken by him or her was
13     warranted by the facts.
14     (e) Powers and duties of Commission. The Commission has the
15 power and duty to:
16         (1) Elect annually from among its members a chairperson
17     and prescribe the duties of that office.
18         (2) Make such rules and regulations, not inconsistent
19     with the laws of the State of Illinois, as may be necessary
20     for the orderly conduct of its affairs and for the
21     administration of this Act, except that no disciplinary
22     action shall be taken without affording due process and in
23     conformity with the rules of civil and or criminal evidence
24     of the State of Illinois.
25         (3) Enforce rules of professional conduct for
26     community managers.



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1         (4) Develop appropriate administrative enforcement
2     procedures for violations of the rules of professional
3     conduct.
4         (5) Prescribe forms for and receive applications for
5     licenses and grant licenses and reinstatements.
6         (6) Approve examinations to be given to applicants.
7         (7) Issue licenses and renewals as provided in this
8     Section.
9         (8) Impose disciplinary actions in the manner
10     prescribed in this Section.
11         (9) Maintain a record of all licenses, suspensions, and
12     revocations, and of its own proceedings.
13         (10) Collect all fees prescribed by this Section.
14         (11) Make rules consistent with this Act to determine
15     the criteria to be included in the State examination and to
16     administer or cause to be administered the State
17     examination.
18         (12) Administer this Section, including the power to
19     hire necessary staff.
20     (f) Disciplinary action. A community manager is subject to
21 disciplinary action if the community manager commits any of the
22 following:
23         (1) A felony or offense involving moral turpitude or
24     unprofessional conduct. "Unprofessional conduct" means
25     violating the provisions of an order of this Commission, an
26     agreement with the Commission, or this Act.



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1         (2) Fails to cooperate with the Commission in the
2     investigation of a complaint, including without
3     limitation, failure to produce any document, book, or
4     record in the possession or control of the community
5     manager after the Commission requests production of that
6     document, book, or record in the course of an investigation
7     of a complaint.
8         (3) Disciplinary action taken by the Commission may
9     consist of one or more of the following:
10             (i) revocation or suspension of license;
11             (ii) refusal to renew or reinstate license;
12             (iii) placement of the community manager on
13         probation for a reasonable period of time;
14             (iv) issuance of reprimand or censure to the
15         community managers; and
16             (v) impose a reasonable fine not to exceed $2,500.
17     (g) Fees.
18         (1) A fee not to exceed $100, as determined by the
19     Commission, shall be paid for each application made to the
20     Commission, whether the application is for examination or
21     reexamination or for issuance, renewal, reactivation, or
22     reinstatement of a license, or any other application
23     requiring formal action or consideration by the
24     Commission.
25         (2) All fees shall be paid to the Commission or its
26     authorized representative and are to be paid by the



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1     applicant in advance of examination dates or of any action
2     by the Commission.
3         (3) To further support the funding of the Commission
4     and the administration of this license program, all
5     community associations registered as Illinois
6     not-for-profit corporations shall pay an annual fee to the
7     Commission of $1 per unit per year with a minimum of $50
8     for a community association.
9         (4) Fees shall not increase more than the increase in
10     the Midwest Area all items all urban Consumer Price Index.
11     (h) Disposition of fees. All fees shall be transmitted to
12 the State Treasurer, for deposit into the Community Manager
13 License Fund, a special fund in the State treasury established
14 to support the license program pursuant to Illinois laws, and
15 the General Assembly shall make annual appropriations from the
16 Fund for the expenditures of the Commission incurred in the
17 performance of its duties under this Act, which expenditures
18 shall be made out of those appropriations upon vouchers and
19 warrants drawn pursuant to law.
20     (i) Requirements. Before applying to take the State license
21 examination, an individual must meet these requirements:
22         (1) shall have attained the age of 21 and be a citizen
23     of the United States;
24         (2) shall not be a convicted felon; and
25         (3) shall either (i) pass an exam covering the
26     fundamentals of community association management,



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1     including the Illinois Condominium Property Act, the
2     Illinois Not-for-Profit Corporation Act, and any other
3     laws the Commission deems appropriate as it relates to
4     community association management; or (ii) furnish evidence
5     satisfactory to the Commission establishing, by experience
6     or education, that the individual is qualified to hold a
7     license.
8     For purposes of this Act, any individual who has practiced
9 management of community associations in the State of Illinois
10 for a period of at least 5 years as of the effective date of
11 this amendatory Act of the 95th General Assembly shall be
12 deemed to be qualified and exempt from the requirements of the
13 examination.
14     (j) License; issuance; renewal; reactivation;
15 reinstatement.
16         (1) A license shall be granted by the Commission to any
17     applicant:
18             (i) who has completed the requirements of
19         subsection (i); and
20             (ii) who further meets the requirements of this
21         Section.
22         (2) All licenses shall expire every 4 years on a date
23     established by the Commission, but may be renewed upon the
24     payment of the renewal fee authorized by the Commission.
25         (3) Any person may reactivate an expired license within
26     a one-year grace period after the date of its expiration by



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1     making written application for reactivation and paying a
2     reactivation fee imposed by the Commission.
3         (4) If a person fails to reactivate his or her license
4     within the one-year grace period specified in subparagraph
5     (3), the person may reinstate the license within 4 years
6     after the date of the expiration of the grace period by
7     making written application for reinstatement, paying a
8     reinstatement fee, and providing proof to the Commission of
9     his or her continued professional competence as required by
10     the Commission. Thereafter, a person shall not be
11     reinstated unless he or she fulfills and meets the
12     requirements and conditions required of an applicant
13     applying for the issuance of an original license, which
14     requirements shall include retaking and passing the State
15     license examination.
16         (5) Any person who performs community association
17     management services after the expiration of his or her
18     license shall be practicing in violation of this Act and
19     shall be subject to the sanctions authorized by this Act.
20     The Commission may refuse to reactivate or reinstate any
21     expired license for conduct that constitutes a violation of
22     any provision of this Act.
23     (k) Fidelity bonds and segregation of accounts.
24         (1) A license holder or the firm with whom the license
25     holder is employed shall not solely and exclusively have
26     access to and disburse funds of a community association



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1     unless:
2             (i) There is a fidelity bond in place.
3             (ii) The fidelity bond is in an amount not less
4         than all moneys of that association.
5             (iii) The fidelity bond covers the license holder
6         and all partners, officers, and employees of the firm
7         with whom the license holder is employed during the
8         term of the bond as well as the association officers,
9         directors, and employees of each community association
10         they service.
11             (iv) The insurance company issuing the bond may not
12         cancel or refuse to renew the bond without giving not
13         less than 10 day's prior written notice.
14             (v) The association shall secure and pay for the
15         bond.
16         (2) A license holder who provides community
17     association management services for more than one
18     community association shall maintain separate, segregated
19     accounts for each community association. The funds shall
20     not, in any event, be commingled with the license holder's
21     or firm's funds or with the funds of any other community
22     association. The maintenance of these accounts by the
23     license holder shall be custodial, and such accounts shall
24     be in the name of the respective community association.
25     (l) Exempt persons. Except as otherwise provided, this
26 Section does not apply to:



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1         (1) A licensed attorney acting solely as an incident to
2     the practice of law.
3         (2) Any person acting as a receiver, trustee in
4     bankruptcy, administrator, executor, or guardian acting
5     under a court order or under the authority of a will or of
6     a trust instrument.
7         (3) Employees of a developer and an affiliated
8     management company of a developer.
9         (4) Managers of commercial or other non-residential
10     condominiums.
11     (m) Standing. Only the duly appointed or elected governing
12 body of a common interest community association based upon a
13 duly adopted resolution shall have standing to file a complaint
14 before the Commission.
15     (n) Defamation. Notwithstanding anything to the contrary
16 in this Section, it shall not be a defense in any defamation
17 suit brought by a manager or management company that a manager
18 or management company is deemed a public or limited public
19 figure.
20     Section 10. The State Finance Act is amended by adding
21 Section 5.675 as follows:
22     (30 ILCS 105/5.675 new)
23     Sec. 5.675. The Community Manager License Fund.
24     Section 99. Effective date. This Act takes effect July 1,



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1 2009.