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Full Text of SB0330  102nd General Assembly

SB0330sam002 102ND GENERAL ASSEMBLY

Sen. Sara Feigenholtz

Filed: 3/19/2021

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 330

2    AMENDMENT NO. ______. Amend Senate Bill 330 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Illinois Housing Development Act is
5amended by adding Section 13.1 as follows:
 
6    (20 ILCS 3805/13.1 new)
7    Sec. 13.1. Form for local agencies. The Authority shall
8develop a form and include it with the final financing
9agreement that summarizes the terms of the financing
10agreement, which should include the following: the length of
11the affordability period guaranteed under the financing
12agreement; a legal description; if then available, the address
13and property index numbers for all applicable property
14contemplated by the agreement; and any other information that
15may be relevant for a local county assessor's office and local
16county and municipal housing development authority to qualify

 

 

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1or evidence eligibility for an applicable reduction in the
2assessed value of an affordable rental housing. This form may
3vary by county only if the Authority deems necessary. The
4nonprofit corporation, housing corporation, limited-profit
5entity, developer, or other entity receiving financing or
6other assistance under this Act shall file the form with the
7local county assessor's office and, where applicable, the
8local county and municipal housing authority for the county in
9which the property is located. No fees shall be levied against
10the nonprofit corporation, housing corporation, limited-profit
11entity, developer, or other entity for filing the form with
12the county assessor's office of local housing authority.
 
13    Section 10. The Property Tax Code is amended by adding
14Section 15-178 as follows:
 
15    (35 ILCS 200/15-178 new)
16    Sec. 15-178. Reduction in assessed value for affordable
17rental housing construction or rehabilitation.
18    (a) The General Assembly finds that there is a shortage of
19high quality affordable rental homes for low-income and
20very-low-income households throughout Illinois; that owners
21and developers of rental housing face significant challenges
22building newly constructed apartments or undertaking
23rehabilitation of existing properties that result in rents
24that are affordable for low-income and very-low-income

 

 

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1households; and that it will help Cook County and other parts
2of Illinois address the extreme shortage of affordable rental
3housing by developing a Statewide policy to determine the
4assessed value for newly constructed and rehabilitated
5affordable rental housing that both encourages investment and
6incentivizes property owners to keep rents affordable.
7    (b) Any county with 3,000,000 or more inhabitants shall
8implement a special assessment program to reduce the assessed
9value of all eligible newly-constructed residential real
10property or qualifying rehabilitation to all eligible existing
11residential real property in accordance with subsection (c)
12for 10 taxable years after the newly constructed residential
13real property or improvements to existing residential real
14property are put in service. Any county with less than
153,000,000 inhabitants may decide not to implement this special
16assessment program upon passage of an ordinance by a majority
17vote of the county board. Subsequent to a vote to opt-out of
18this special assessment program, any county with less than
193,000,000 inhabitants may decide to implement this special
20assessment program upon passage of an ordinance by a majority
21vote of the county board. Property is eligible for the special
22assessment program if and only if all of the following factors
23have been met:
24        (1) the property consists of a newly-constructed
25    multifamily building containing 7 or more rental dwelling
26    units or an existing multifamily building that has

 

 

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1    undergone qualifying rehabilitation resulting in 7 or more
2    rental dwelling units;
3        (2) except as defined in subparagraphs (E), (F), and
4    (G) of paragraph (6) of subsection (d) of this Section,
5    prior to the newly-constructed residential real property
6    or improvements to existing residential real property
7    being put in service, the owner of the residential real
8    property commits that, for a period of 10 years, at least
9    15% of the multifamily building's units will have rents as
10    defined in this Section that are at or below maximum rents
11    and are occupied by households with household incomes at
12    or below maximum income limits; and
13        (3) the property meets the application requirements
14    defined in subsection (d).
15    (c) The amount of the reduction shall be calculated as
16follows:
17        (1) if the owner of the residential real property
18    commits for a period of at least 10 years that at least 15%
19    but fewer than 35% of the multifamily building's units
20    have rents at or below maximum rents and are occupied by
21    households with household incomes at or below maximum
22    income limits, the assessed value of the property used to
23    calculate the tax bill shall be reduced by an amount equal
24    to 25% of the assessed value of the property as initially
25    determined by the assessor for the property in the current
26    taxable year for the newly-constructed residential real

 

 

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1    property or based on the improvements to an existing
2    residential real property; and
3        (2) if the owner of the residential real property
4    commits for a period of at least 10 years that at least 35%
5    of the multifamily building's units have rents at or below
6    maximum rents and are occupied by households with
7    household incomes at or below maximum income limits, the
8    assessed value of the property used to calculate the tax
9    bill shall be reduced by an amount equal to 35% of the
10    assessed value of the property as initially determined by
11    the assessor for the property in the current assessment
12    year for the newly constructed residential real property
13    or based on the improvements to an existing residential
14    real property.
15    (d) Application requirements.
16        (1) In order to receive the reduced valuation under
17    this Section, the owner must submit an application
18    containing the following information to the chief county
19    assessment officer for review in the form required by the
20    chief county assessment officer:
21            (A) the owner's name;
22            (B) the postal address and permanent index number
23        or numbers of the parcel or parcels for which the owner
24        is applying to receive reduced valuation under this
25        Section;
26            (C) a deed or other instrument conveying the

 

 

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1        parcel or parcels to the current owner;
2            (D) written evidence that the new construction or
3        qualifying rehabilitation has been completed with
4        respect to the residential real property, including,
5        but not limited to, copies of building permits, a
6        notarized contractor's sworn affidavit, and
7        photographs of the interior and exterior of the
8        building after new construction or rehabilitation is
9        completed;
10            (E) written evidence that the residential real
11        property meets local building codes, or if there are
12        no local building codes, Housing Quality Standards, as
13        determined by the United States Department of Housing
14        and Urban Development;
15            (F) a list identifying the affordable units in
16        residential real property and a written statement that
17        the affordable units are comparable to the market rate
18        units in terms of unit type, number of bedrooms per
19        unit, quality of exterior appearance, energy
20        efficiency, and overall quality of construction;
21            (G) a written schedule certifying the rents in
22        each affordable unit and a written statement that
23        these rents do not exceed the maximum rents allowable
24        for the area in which the residential real property is
25        located;
26            (H) documentation from the administering agency

 

 

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1        verifying the owner's participation in a qualifying
2        income-based rental subsidy program as defined in
3        subsection (e) of this Section if units receiving
4        rental subsidies are to be counted among the
5        affordable units in order to meet the thresholds
6        defined in this Section;
7            (I) a written statement identifying the household
8        income for every household occupying an affordable
9        unit and certifying that the household income does not
10        exceed the maximum income limits allowable for the
11        area in which the residential real property is
12        located;
13            (J) a written statement that the owner has
14        verified and retained documentation of household
15        income for every household occupying an affordable
16        unit; and
17            (K) any additional information consistent with
18        this Section as reasonably required by the chief
19        county assessment officer, including, but not limited
20        to, any information necessary to ensure compliance
21        with applicable local ordinances and to ensure the
22        owner is complying with the provisions of this
23        Section.
24        (2) The application requirements contained in
25    subparagraphs (A), (B), (C), (F), (G), (H), (I), (J), and
26    (K) of paragraph (1) of this subsection (d) are continuing

 

 

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1    requirements for the duration of the reduction in assessed
2    value and may be annually or periodically verified by the
3    chief county assessment officer for the county in which
4    the reduced valuation is being issued.
5        (3) In lieu of submitting an application containing
6    the information prescribed in paragraph (1) of this
7    subsection (d), the chief county assessment officer may
8    allow for the submission of a substantially similar
9    certification granted by the Illinois Housing Development
10    Authority or a comparable local authority provided that
11    the chief county assessment officer independently verifies
12    the veracity of the certification with the Illinois
13    Housing Development Authority or comparable local
14    authority.
15        (4) The chief county assessment officer shall notify
16    the owner as to whether or not the property meets the
17    requirements of this Section. If the property does not
18    meet the requirements of this Section, the chief county
19    assessment officer shall provide written notice of any
20    deficiencies to the owner, who shall then have 30 days
21    from the date of notification to provide supplemental
22    information showing compliance with this Section. If the
23    owner does not exercise this right to cure the deficiency,
24    or if the information submitted, in the sole judgment of
25    the chief county assessment officer, is insufficient to
26    meet the requirements of this Section, the chief county

 

 

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1    assessment officer shall provide a written explanation of
2    the reasons for denial.
3        (5) The chief county assessment officer may charge a
4    reasonable application fee to offset the administrative
5    expenses associated with the program.
6        (6) The reduced valuation conferred by this Section is
7    limited as follows:
8            (A) The owner is eligible to apply for the reduced
9        valuation conferred by this Section beginning in the
10        first assessment cycle after the effective date of
11        this amendatory Act of the 102nd General Assembly
12        through December 31, 2031. If approved, the reduction
13        will be effective for the current assessment year,
14        which will be reflected in the tax bill issued in the
15        following calendar year. Owners that are approved for
16        the reduced valuation under this Section before
17        December 31, 2031 shall, at minimum, be eligible for
18        annual renewal of the reduced valuation during an
19        initial 10-year period if annual certification
20        requirements are met for each of the 10 years, as
21        described in subparagraph (B) of this paragraph (6) of
22        this Section until December 31, 2041.
23            (B) Property receiving a reduction outlined in
24        this Section shall continue to be eligible for an
25        initial period of up to 10 years if annual
26        certification requirements are met for each of the 10

 

 

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1        years, but shall be extended for up to 2 additional
2        10-year periods with annual renewals if the owner
3        continues to meet the requirements of this Section,
4        including annual certifications, and excluding the
5        requirements regarding new construction or qualifying
6        rehabilitation defined in subparagraph (D) of
7        paragraph (1) of this subsection.
8            (C) The annual certification materials in the year
9        prior to final year of eligibility for the reduction
10        in assessed value must include a dated copy of the
11        written notice provided to tenants informing them of
12        the date of the termination if the owner is not seeking
13        a renewal.
14            (D) If the property is sold or transferred, the
15        purchaser or transferee must comply with all
16        requirements of this Section, excluding the
17        requirements regarding new construction or qualifying
18        rehabilitation defined in subparagraph (D) of
19        paragraph (1) of this subsection, in order to continue
20        receiving the reduction in assessed value. Purchasers
21        and transferees who comply with all requirements of
22        this Section excluding the requirements regarding new
23        construction or qualifying rehabilitation defined in
24        subparagraph (D) of paragraph (1) of this subsection
25        are eligible to apply for renewal on the schedule set
26        by the initial application.

 

 

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1            (E) The owner may apply for the reduced valuation
2        if the residential real property meets all
3        requirements of this Section and the newly-constructed
4        residential real property or improvements to existing
5        residential real property were put in service on or
6        after January 1, 2015. However, the initial 10-year
7        eligibility period shall be reduced by the number of
8        years between the placed in service date and the date
9        the owner first receives this reduced valuation.
10            (F) The owner may apply for the reduced valuation
11        within 2 years after the newly-constructed residential
12        real property or improvements to existing residential
13        real property are put in service. However, the initial
14        10 year eligibility period shall be reduced for the
15        number of years between the placed in service date and
16        the date the owner first receives this reduced
17        valuation.
18            (G) Owners of a multifamily building receiving a
19        reduced valuation through the Cook County Class 9
20        program during the year in which this amendatory Act
21        of the 102nd General Assembly takes effect shall be
22        deemed automatically eligible for the reduced
23        valuation defined in this Section in terms of meeting
24        the criteria for new construction or substantial
25        rehabilitation for a specific multifamily building
26        regardless of when the newly-constructed residential

 

 

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1        real property or improvements to existing residential
2        real property were put in service. If a Cook County
3        Class 9 owner had Class 9 status revoked on or after
4        January 1, 2017 but can provide documents sufficient
5        to prove that the revocation was in error or any
6        deficiencies leading to the revocation have been
7        cured, the chief county assessment officer may deem
8        the owner to be eligible. However, owners may not
9        receive the both the reduced valuation under this
10        Section and the reduced valuation under the Cook
11        County Class 9 program in any single assessment year.
12        In addition, the number of years during which an owner
13        has participated in the Class 9 program shall count
14        against the number of remaining years eligible for the
15        reduced valuation as defined in this Section.
16            (H) At the completion of the assessment reduction
17        period described in this Section, the entire parcel
18        will be assessed as otherwise provided in State law.
19    (e) For the purposes of this Section,
20    "Affordable units" means units that have rents that do not
21exceed the maximum rents as defined in this Section.
22    "Household income" includes the annual income for all the
23people who occupy a housing unit that is anticipated to be
24received from a source outside of the family during the
2512-month period following admission or the annual
26recertification, including related family members and all the

 

 

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1unrelated people who share the housing unit. Household income
2includes the sum total of the following income sources: wages,
3salaries and tips before any payroll deductions; net business
4income; interest and dividends; payments in lieu of earnings,
5such as unemployment and disability compensation, worker's
6compensation and severance pay; Social Security income,
7including lump sum payments; payments from insurance policies,
8annuities, pensions, disability benefits and other types of
9periodic payments, alimony, child support, and other regular
10monetary contributions; and public assistance, except for
11assistance from the Supplemental Nutrition Assistance Program
12(SNAP). "Household income" does not include: earnings of
13children under age 18; temporary income such as cash gifts;
14reimbursement for medical expenses; lump sums from
15inheritance, insurance payments, settlements for personal or
16property losses; student financial assistance paid directly to
17the student or to an educational institution; foster child
18care payments; receipts from government-funded training
19programs; assistance from the Supplemental Nutrition
20Assistance Program (SNAP).
21    "Maximum income limits" means the maximum regular income
22limits for 60% of area median income for the geographic area in
23which the multifamily building is located for multifamily
24programs as determined by the United States Department of
25Housing and Urban Development and published annually by the
26Illinois Housing Development Authority.

 

 

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1    "Maximum rent" means the maximum regular rent for 60% of
2the area median income for the geographic area in which the
3multifamily building is located for multifamily programs as
4determined by the United States Department of Housing and
5Urban Development and published annually by the Illinois
6Housing Development Authority. To be eligible for the reduced
7valuation defined in this Section, maximum rents are to be
8consistent with the Illinois Housing Development Authority's
9rules; or if the owner is leasing an affordable unit to a
10household with an income at or below the maximum income limit
11who is participating in qualifying income-based rental subsidy
12program, "maximum rent" means the maximum rents allowable
13under the guidelines of the qualifying income-based rental
14subsidy program.
15    "Qualifying income-based rental subsidy program" means a
16Housing Choice Voucher issued by a housing authority under
17Section 8 of the United States Housing Act of 1937, a tenant
18voucher converted to a project-based voucher by a housing
19authority or any other program administered or funded by a
20housing authority, the Illinois Housing Development Authority,
21another State agency, a federal agency, or a unit of local
22government where participation is limited to households with
23incomes at or below the maximum income limits as defined in
24this Section and the tenants' portion of the rent payment is
25based on a percentage of their income or a flat amount that
26does not exceed the maximum rent as defined in this Section.

 

 

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1    "Qualifying rehabilitation" means, at a minimum,
2compliance with local building codes and the replacement or
3renovation of at least 2 primary building systems. Although
4the cost of each primary building system may vary, to be
5approved for the reduced valuation under paragraph (1) of
6subsection (c) of this Section, the combined expenditure for
7making the building compliant with local codes and replacing
8primary building systems must be at least $8 per square foot
9for work completed between January 1 of the year in which this
10amendatory Act of the 102nd General Assembly takes effect and
11December 31 of the year in which this amendatory Act of the
12102nd General Assembly takes effect and in subsequent years,
13$8 adjusted by the Consumer Price Index for All Urban
14Consumers, as published annually by the U.S. Department of
15Labor. To be approved for the reduced valuation under
16paragraph (2) of subsection (c) of this Section, the combined
17expenditure for making the building compliant with local codes
18and replacing primary building systems must be at least $12.50
19per square foot for work completed between January 1 of the
20year in which this amendatory Act of the 102nd General
21Assembly takes effect and December 31 of the year in which this
22amendatory Act of the 102nd General Assembly takes effect, and
23in subsequent years, $12.50 adjusted by the Consumer Price
24Index for All Urban Consumers, as published annually by the
25U.S. Department of Labor. Primary building systems, together
26with their related rehabilitations, specifically approved for

 

 

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1this program are:
2        (1) Electrical. All electrical work must comply with
3    applicable codes; it may consist of a combination of any
4    of the following alternatives:
5            (A) installing individual equipment and appliance
6        branch circuits as required by code (the minimum being
7        a kitchen appliance branch circuit);
8            (B) installing a new emergency service, including
9        emergency lighting with all associated conduits and
10        wiring;
11            (C) rewiring all existing feeder conduits ("home
12        runs") from the main switchgear to apartment area
13        distribution panels;
14            (D) installing new in-wall conduits for
15        receptacles, switches, appliances, equipment, and
16        fixtures;
17            (E) replacing power wiring for receptacles,
18        switches, appliances, equipment, and fixtures;
19            (F) installing new light fixtures throughout the
20        building including closets and central areas;
21            (G) replacing, adding, or doing work as necessary
22        to bring all receptacles, switches, and other
23        electrical devices into code compliance;
24            (H) installing a new main service, including
25        conduit, cables into the building, and main disconnect
26        switch; and

 

 

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1            (I) installing new distribution panels, including
2        all panel wiring, terminals, circuit breakers, and all
3        other panel devices.
4        (2) Heating. All heating work must comply with
5    applicable codes; it may consist of a combination of any
6    of the following alternatives:
7            (A) installing a new system to replace one of the
8        following heat distribution systems:
9                (i) piping and heat radiating units, including
10            new main line venting and radiator venting; or
11                (ii) duct work, diffusers, and cold air
12            returns; or
13                (iii) any other type of existing heat
14            distribution and radiation/diffusion components;
15            or
16            (B) installing a new system to replace one of the
17        following heat generating units:
18                (i) hot water/steam boiler;
19                (ii) gas furnace; or
20                (iii) any other type of existing heat
21            generating unit.
22        (3) Plumbing. All plumbing work must comply with
23    applicable codes. Replace all or a part of the in-wall
24    supply and waste plumbing; however, main supply risers,
25    waste stacks and vents, and code-conforming waste lines
26    need not be replaced.

 

 

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1        (4) Roofing. All roofing work must comply with
2    applicable codes; it may consist of either of the
3    following alternatives, separately or in combination:
4            (A) replacing all rotted roof decks and
5        insulation; or
6            (B) replacing or repairing leaking roof membranes
7        (10% is the suggested minimum replacement of
8        membrane); restoration of the entire roof is an
9        acceptable substitute for membrane replacement.
10        (5) Exterior doors and windows. Replace the exterior
11    doors and windows. Renovation of ornate entry doors is an
12    acceptable substitute for replacement.
13        (6) Floors, walls, and ceilings. Finishes must be
14    replaced or covered over with new material. Acceptable
15    replacement or covering materials are as follows:
16            (A) floors must have new carpeting, vinyl tile,
17        ceramic, refurbished wood finish, or a similar
18        substitute;
19            (B) walls must have new drywall, including joint
20        taping and painting; or
21            (C) new ceilings must be either drywall, suspended
22        type, or a similar
23        (7) Exterior walls.
24            (A) replace loose or crumbling mortar and masonry
25        with new material;
26            (B) replace or paint wall siding and trim as

 

 

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1        needed;
2            (C) bring porches and balconies to a sound
3        condition; or
4            (D) any combination of (A), (B), and (C).
5        (8) Elevators. Where applicable, at least 4 of the
6    following 7 alternatives must be accomplished:
7            (A) replace or rebuild the machine room controls
8        and refurbish the elevator machine (or equivalent
9        mechanisms in the case of hydraulic elevators);
10            (B) replace hoistway electro-mechanical items
11        including: ropes, switches, limits, buffers, levelers,
12        and deflector sheaves (or equivalent mechanisms in the
13        case of hydraulic elevators);
14            (C) replace hoistway wiring;
15            (D) replace door operators and linkage;
16            (E) replace door panels at each opening;
17            (F) replace hall stations, car stations, and
18        signal fixtures; or
19            (G) rebuild the car shell and refinish the
20        interior.
21        (9) Health and safety.
22            (A) install or replace fire suppression systems;
23            (B) install or replace security systems; or
24            (C) environmental remediation of lead-based paint,
25        asbestos, leaking underground storage tanks, or radon.
26        (10) Energy conservation improvements undertaken to

 

 

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1    limit the amount of solar energy absorbed by a building's
2    roof or to reduce energy use for the property, including,
3    but not limited to, any of the following activities:
4            (A) installing or replacing reflective roof
5        coatings (flat roofs);
6            (B) installing or replacing R-49 roof insulation;
7            (C) installing or replacing R-19 perimeter wall
8        insulation;
9            (D) installing or replacing insulated entry doors;
10            (E) installing or replacing Low E, insulated
11        windows;
12            (F) installing or replacing WaterSense labeled
13        plumbing fixtures;
14            (G) installing or replacing 90% or better sealed
15        combustion heating systems;
16            (H) installing Energy Star hot water heaters;
17            (I) installing or replacing mechanical ventilation
18        to exterior for kitchens and baths;
19            (J) installing or replacing Energy Star
20        appliances;
21            (K) installing or replacing Energy Star certified
22        lighting in common areas; or
23            (L) installing or replacing grading and
24        landscaping to promote on-site water retention if the
25        retained water is used to replace water that is
26        provided from a municipal source.

 

 

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1        (11) Accessibility improvements. All accessibility
2    improvements must comply with applicable codes. An owner
3    may make accessibility improvements to residential real
4    property to increase access for people with disabilities.
5    As used in this paragraph (11), "disability" has the
6    meaning given to that term in the Illinois Human Rights
7    Act. As used in this paragraph (11), "accessibility
8    improvements" means a home modification listed under the
9    Home Services Program administered by the Department of
10    Human Services (Part 686 of Title 89 of the Illinois
11    Administrative Code) including, but not limited to:
12    installation of ramps, grab bars, or wheelchair lifts;
13    widening doorways or hallways; re-configuring rooms and
14    closets; and any other changes to enhance the independence
15    of people with disabilities.
16        (12) Any applicant who has purchased the property in
17    an arm's length transaction not more than 90 days before
18    applying for this reduced valuation may use the cost of
19    rehabilitation or repairs required by documented code
20    violations, up to a maximum of $2 per square foot, to meet
21    the qualifying rehabilitation requirements.
 
22    Section 99. Effective date. This Act takes effect upon
23becoming law.".