SB 948 — CONDO/CICAA: BUDGETS; MEETINGS

*LRB10006987HEP17040b* SB0948 100THEngrossed GENERALLRB100 ASSEMBLY06987 StateHEP of17040 Illinoisb andAN 2018ACT SB0948concerning Introducedcivil 2/7/2017,law. by Sen.

Michael E.

Hastings SYNOPSIS AS INTRODUCED:

ILCS 160/1-45 ILCS 605/18.5 from Ch.

30, par.

318.5 Amends the Common Interest Community Association Act.

Provides that each member of a common interest community association shall receive through a prescribed delivery method, at least 25 (instead of 30) days but not more than 60 days prior to the adoption by the board, a copy of the proposed annual budget.

Makes a similar change in the Condominium Property Act.

Further amends the Condominium Property Act.

Replaces language specifying when a portion of a noticed board meeting may be closed with language providing that the board may close any portion of a noticed meeting or meet separately from a noticed meeting to:

(A) discuss litigation when an action against or on behalf of the particular association has been filed and is pending in a court or administrative tribunal, or when the board of managers finds that such an action is probable or imminent;

(B) discuss the appointment, employment, engagement, or dismissal of an employee, independent contractor, agent, or other provider of goods and services;

(C) interview a potential employee, independent contractor, agent, or other provider of goods and services;

(D) discuss violations of rules and regulations of the association;

(E) discuss a unit owner's unpaid share of common expenses;

or (F) consult with the association's legal counsel.

LRB100 06987 HEP 17040 b A BILL FOR SB0948 LRB100 06987 HEP 17040 b AN ACT concerning civil law.

The board shall (i) make available for review to all members an itemized accounting of the common expenses for the preceding year actually incurred or paid, together with an indication of which portions were for reserves, capital expenditures or repairs or payment of real estate taxes and with a tabulation of the amounts collected pursuant to the budget or assessment, and showing the net excess or deficit of income over expenditures plus reserves or SB0948 Engrossed - 2 - LRB100 06987 HEP 17040 b (ii) provide a consolidated annual independent audit report of the financial status of all fund accounts within the association.

As used herein, "emergency" means a danger to or a compromise of the structural SB0948 Engrossed - 3 - LRB100 06987 HEP 17040 b integrity of the common areas or any of the common facilities of the common interest community.

318.5) SB0948 Engrossed - 4 - LRB100 06987 HEP 17040 b Sec.

(2) The board of the master association shall annually supply to all unit owners of condominiums subject to the authority of the board of the master association an SB0948 Engrossed - 5 - LRB100 06987 HEP 17040 b itemized accounting of the common expenses for the preceding year actually incurred or paid, together with a tabulation of the amounts collected pursuant to the budget or assessment, and showing the net excess or deficit of income over expenditures plus reserves.

SB0948 Engrossed - 6 - LRB100 06987 HEP 17040 b (C) interview a potential employee, independent contractor, agent, or other provider of goods and services;

SB0948 Engrossed - 7 - LRB100 06987 HEP 17040 b Notice of meetings shall be mailed or delivered at least 48 hours prior thereto, unless a written waiver of such notice is signed by the persons entitled to notice before the meeting is convened.

In no event may the seller and purchaser both be counted toward a quorum, be permitted to SB0948 Engrossed - 8 - LRB100 06987 HEP 17040 b vote for a particular office, or be elected and serve on the board.

(i) the managing agent fees relate to the costs to collect SB0948 Engrossed - 9 - LRB100 06987 HEP 17040 b common expenses for the Association;

(ii) Detailed and accurate records in chronological order of the receipts and expenditures affecting the common areas, specifying and itemizing SB0948 Engrossed - 10 - LRB100 06987 HEP 17040 b the maintenance and repair expenses of the common areas and any other expenses incurred, and copies of all contracts, leases, or other agreements entered into by the master association, shall be maintained.

(2) Where a request for records under this subsection is made in writing to the board of managers or its agent, failure to provide the requested record or to respond within 30 days shall be deemed a denial by the board of SB0948 Engrossed - 11 - LRB100 06987 HEP 17040 b directors.

(2) The election of the initial board of directors of a master association whose declaration is recorded on or SB0948 Engrossed - 12 - LRB100 06987 HEP 17040 b after August 10, 1990, by the unit owners or the boards of managers of the underlying condominium associations, shall be held not later than 60 days after the conveyance by the developer of 75% of the units, or 3 years after the recording of the declaration, whichever is earlier.

(4) Within 60 days following the election of a majority of the board of directors, other than the developer, by SB0948 Engrossed - 13 - LRB100 06987 HEP 17040 b unit owners, the developer shall deliver to the board of directors:

(iv) A schedule of all real or personal property, equipment and fixtures belonging to the association, including documents transferring the property, warranties, if any, for all real and personal property and equipment, deeds, title insurance policies, and SB0948 Engrossed - 14 - LRB100 06987 HEP 17040 b all tax bills.

(5) With respect to any master association whose SB0948 Engrossed - 15 - LRB100 06987 HEP 17040 b declaration is recorded on or after August 10, 1990, any contract, lease, or other agreement made prior to the election of a majority of the board of directors other than the developer by or on behalf of unit owners or underlying condominium associations, the association or the board of directors, which extends for a period of more than 2 years from the recording of the declaration, shall be subject to cancellation by more than 1/2 of the votes of the unit owners, other than the developer, cast at a special meeting of members called for that purpose during a period of 90 days prior to the expiration of the 2 year period if the board of managers is elected by the unit owners, otherwise by more than 1/2 of the underlying condominium board of managers.

SB0948 Engrossed - 16 - LRB100 06987 HEP 17040 b (6) The statute of limitations for any actions in law or equity which the master association may bring shall not begin to run until the unit owners or underlying condominium board of managers have elected a majority of the members of the board of directors.

SB0948 Engrossed - 17 - LRB100 06987 HEP 17040 b (7) A statement setting forth what insurance coverage is provided for all unit owners by the association.

(g-1) The purchaser of a unit of a common interest community at a judicial foreclosure sale, other than a mortgagee, who takes possession of a unit of a common interest community pursuant to a court order or a purchaser who acquires title from a mortgagee shall have the duty to pay the proportionate share, if any, of the common expenses for the unit that would have become due in the absence of any assessment acceleration during the 6 months immediately preceding institution of an action to enforce the collection of assessments and the court costs incurred by the association in an action to enforce the collection that remain unpaid by the SB0948 Engrossed - 18 - LRB100 06987 HEP 17040 b owner during whose possession the assessments accrued.

(2) If, through a scrivener's error, a unit has not been designated as owning an appropriate undivided share of the common areas or does not bear an appropriate share of SB0948 Engrossed - 19 - LRB100 06987 HEP 17040 b the common expenses, or if all of the common expenses or all of the common elements in the condominium have not been distributed in the declaration, so that the sum total of the shares of common areas which have been distributed or the sum total of the shares of the common expenses fail to equal 100%, or if it appears that more than 100% of the common elements or common expenses have been distributed, the error may be corrected by operation of law by filing an amendment to the declaration, approved by vote of two-thirds of the members of the board of directors or a majority vote of the unit owners at a meeting called for that purpose, which proportionately adjusts all percentage interests so that the total is equal to 100%, unless the declaration specifically provides for a different procedure or different percentage vote by the owners of the units and the owners of mortgages thereon affected by modification being made in the undivided interest in the common areas, the number of votes in the unit owners association or the liability for common expenses appertaining to the unit.

(3) If an omission or error or a scrivener's error in the declaration or other instrument is corrected by vote of two-thirds of the members of the board of directors pursuant to the authority established in subdivisions (h)(1) or (h)(2) of this Section, the board, upon written petition by unit owners with 20% of the votes of the SB0948 Engrossed - 20 - LRB100 06987 HEP 17040 b association or resolutions adopted by the board of managers or board of directors of the condominium and common interest community associations which select 20% of the members of the board of directors of the master association, whichever is applicable, received within 30 days of the board action, shall call a meeting of the unit owners or the boards of the condominium and common interest community associations which select members of the board of directors of the master association within 30 days of the filing of the petition or receipt of the condominium and common interest community association resolution to consider the board action.

This Section does not restrict the powers of the association to otherwise amend the declaration, bylaws, or SB0948 Engrossed - 21 - LRB100 06987 HEP 17040 b other condominium instruments, but authorizes a simple process of amendment requiring a lesser vote for the purpose of correcting defects, errors, or omissions when the property rights of the unit owners are not materially or adversely affected.

(6) Nothing contained in this Section shall be construed to invalidate any provision of a declaration authorizing the developer to amend an instrument prior to SB0948 Engrossed - 22 - LRB100 06987 HEP 17040 b the latest date on which the initial membership meeting of the unit owners must be held, whether or not it has actually been held, to bring the instrument into compliance with the legal requirements of the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, the Federal Housing Administration, the United States Veterans Administration or their respective successors and assigns.