“2023 Illinois Landlord/Tenant Legal Updates” – KSN landlord/tenant attorney Jessica Ryan discusses the addition of source of income as a protect class to Illinois Fair Housing law and the impact on Chicagoland and Illinois landlords. Jessica reviews how this legal update affects tenants, Section 8 housing vouchers, screening, inspections, property management, and more. (52 mins.)
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Episode Transcription
Bernie: You are listening to the KSN Podcast and on this episode, we’re talking 2023 legal updates to landlord tenant law. Welcome to the KSN podcast, where you’ll hear from KSN attorneys as they share their experience and insight on legal issues surrounding community associations, collections, property tax appeals, and landlord tenant law. I’m Bernie, and this episode is a replay of our landlord tenant law legal updates for the year 2023 presented by KSN attorney Jessica Ryan. The webinar was on January 11th, 2023. Jessie covered a number of legal updates impacting fair housing law, source of income, tenant screening, section eight vouchers, and other legal updates that impact Illinois landlords and property managers.
Jessie: All right, let’s get started. So, we have a lot to talk about today. Main thing being that source of income, new law that went into effect January 1st. So, we are definitely going to cover a lot in the next hour because I will get to as many questions as I can. If there are questions that I see that are really relevant to what we’re talking about at the moment, I may hit those and try and answer those, otherwise I plan to leave some time at the end to kind of scroll through the questions and get as many answers as possible. But I definitely want to dive in here. So, let’s talk about sources of income. Source of income, the new law that just went into effect January 1st adding source of income as a protected class. I want to give you a little bit of background first.
So, we’ve got a Federal Fair Housing Act established back in 1968 that prohibits discrimination in all real estate transactions, including renting a unit, renting an apartment, renting a condo, and renting a home. Illinois then passed their Illinois Human Rights Act, which added further protected classes and kind of expanded the categories of people and classes of people that are protected from discrimination, including ancestry, age, order of protection status, marital status, pregnancy and unfavorable discharge in military service. Now, what has happened is the Illinois Human Rights Act has been amended as well to add the term source of income as a protected class. This is a law that was adopted in 2022 and it became effective January 1st of this year. The general restriction, the new thing everybody is worried about is that basically it just states you cannot discriminate based on a tenant’s source of income and their source of income is defined as any lawful manner by which the individual supports him or herself and their dependents.
So, what does that mean? So, source of income is going to be any type of subsidy voucher, we’re talking Section eight, any type of charitable contribution to their rent that the tenant is getting to subsidize their income and their rental payment. So, you cannot discriminate because an applicant for your rental property has a voucher or is getting some type of subsidy for their rent. If you do, you would be discriminating based on their source of income. So, how is this going to be implemented? How is this going to be enforced? Well, the problem we’re seeing is this is an Illinois state law and IHDA, the Illinois Housing Development Authority and the Illinois Human Rights Commission have not really given any guidance or instruction on how properties and managers and landlords should implement this, nor have they told us how they’re going to enforce it. Attorney groups and some landlord organizations have been reaching out and trying to get some guidance and state representatives in those two organizations, in those two state offices, are hesitant to provide any guidance. We’ve gotten a lot of we’re going to see how it rolls out, I’m sure it’ll be similar to counties that already provide this, we’re just going to kind of see how things go.
So, everything I am telling you today, there is some gray area. We have similar ordinances in Cook County. Cook County has had source of income as a protected class for years, as has Naperville. So, we look to those jurisdictions to kind of see how source of income has been implemented, what landlords have been required to do, how it’s been enforced to kind of try and figure out how the state might enforce it statewide, but there’s a lot of gray area. I will say there is some hesitation among the attorneys to come out and say, this is what you should do and this is what you shouldn’t do because we can’t give you solid concrete advice without really having that guidance from the state telling us this is how it’s going to be implemented, this is how it’s going to be enforced. So, you might hear me say a few times today talking about source of income, that again, this is a gray area. Once it starts to be enforced by the state, once it gets really put into motion here, we might see some changes, we might see some things being enforced differently. So be prepared for that.
What I want to do today is give you as much information as possible so that you are complying to the extent that we know and to the extent we have seen in counties that already have this in place to protect yourself as much as possible. We do have our client blasts all of the time with different updates, letting clients know different changes in the law and sometimes new interpretations of the law, which could be in this case. So, definitely if you have not signed up with us on our web page, you can find what we call lamp, it’s the Landlord Assistance Multipurpose Program and you can sign up through there and then you can receive all of our client blasts and keep updated. So, like I said, there are similar local ordinances, all of Cook County has had source of income. So, if you are a landlord in Cook County, this should not be news to you, source of income has been a protected class and you cannot deny a tenant based on Section eight in Cook County for years and Naperville the same. So, Naperville works with the DuPage Housing Authority, so DuPage has had a little bit of guidance as well.
Talk a little bit about what happens when you have a tenant who has a subsidy. So, the housing authority or the subsidy program is going to issue you what they call a HAP contract, H.A.P and that contract is their contract to provide payments to you in exchange for you providing this tenant their unit. This is not the lease, you would still enter into a separate lease with the tenant, but this is the HAP contract with the housing authority and in that HAP contract, they will give you their market rent analysis and they want rent to be set at a certain rate based on their tables and guidelines that they issue. It will define the amount of the voucher or subsidy that they are going to be providing. The voucher or the subsidy, when I use those terms for anyone that isn’t familiar or hasn’t taken any Section eight tenants in the past, that voucher is the amount that the housing authority is paying toward the tenant’s rent. That is their subsidy payment. Now, you do as a landlord have the authority to reject that contract if the rent, they are offering does not meet the market standards as you see that. So, you can reject a HAP contract if you need to.
So, as I said, you cannot reject an applicant simply because the applicant has a subsidy or voucher. I know my clients in the Collar Counties outside of Cook County routinely just say, an applicant walks in with a voucher, I’m sorry, we don’t accept section eight. You cannot use that language anymore. You will get slapped with a discrimination complaint faster than I can say the word discrimination. So, you have to train your onsite employees and your staff on how to run and screen an applicant’s application when they have a subsidy or a voucher and how to go through the process. Now, one of those issues that comes up, and this is an issue we do not have guidance on from the state, is the calculation for three times the income. So, generally a standard that a lot of my clients and landlords use is that the applicant’s income has to be three times the amount of the rent and if the tenant or applicant meets that standard, then they qualify income, it’s still checked credit and all the other stuff. But that’s generally that rule, that three times rule.
So, the question becomes when you are looking at the tenant’s income multiply to check if it follows the three times rule, should you be including the subsidy payment. When you say this amount is the rent, is the tenant’s income three times that amount? And there’s actually a discrepancy between the housing authority of Cook County and the DuPage Housing Authority; one allows you to include the subsidy payment and one, it’s kind of an accepted no-no. So, it’s going to be interesting to see whether we can, whether you’re going to be able to statewide and how the Illinois agencies actually enforce that. Now, the more conservative approach is obviously to just use the tenant’s portion and make sure that they are qualifying just on their portion alone. So just for now, that would be my recommendation to stay safe but again, we’re going to be watching that issue carefully to see if any changes come up as the state starts accepting and implementing this
Bernie: Since 1983, KSN has provided landlords with affordable comprehensive legal services. KSN can eliminate the need for multiple law firms to handle the broad spectrum of a landlord’s basic legal requirements. Through our landlord assistance multipurpose program or LAMP landlords receive exceptional service related to their tenant-based issues. Some of the LAMP program features include residential and commercial evictions, review of leases, disclosures and vendor contracts, ordinance and code compliance, tenants and third-party dispute negotiations and resolution including local property ordinances laws and more. If you’re a landlord experiencing any tenant issues or legal questions, just visit ksnlaw.com/lamp.
Jessie: Looking at a couple of questions here, do we have to accept unemployment as a source of income? Yes, that is considered their income and part of their income. So, you cannot discriminate based on their source of income and that includes unemployment payments. And then I have a very general question; if a landlord does not want to accept section eight as part of their business of renting their properties, can the landlord say, no? No, you cannot. You must be open to section eight tenants. You must allow all section eight tenants to apply and submit applications for your property and then you can process them, you can review the HAP contract and determine whether that particular HAP contract and that tenant meets the rest of your qualifications and if the HAP contract makes sense for your property. Does this help for any type of subsidy? What if the subsidy is through a church or another program and not a federal or state program? And yes, that is correct. Any type of charitable organization that is subsidizing the tenant’s rent counts as their source of income and you cannot discriminate based on their source of income.
All right, so another issue that is very, very relevant that I get asked about a lot is holding a unit. So, when the housing authority or subsidy program gives you the HAP contract and you want to move forward, they are going to need to inspect the unit to be sure that everything needs building code standards and that they are willing to pay rent for that unit. Now, by law and what the housing authorities always say, their standard line is that you are not required to hold the unit indefinitely and that your policy on holding units any general market rate units will apply. However, that’s not really what happens in practice. So, you should allow a reasonable amount of time for the housing authority to conduct the inspection. If you hold a unit for, let’s say, 72 hours or three days, it’s going to take longer for the housing authority to come out. They’re not going to get out there probably in 72 hours. So, what most of my clients and the Cook County clients who’ve been doing this for years see is that they do have to hold units longer and each manager or company for itself sets a policy, a guideline for how long they will hold a unit.
Sometimes it’s a case-by-case basis. If you’ve got an inspector who says I can get out Friday, please hold it till Friday, that’s great. Okay, we’ll hold it till Friday. If you’ve got an inspector who isn’t responding and you don’t have a date and a week and a half has gone by, you could be analyzing these on a case-by-case basis. You could set a policy that you will hold it for a certain number of days before you then turn it back over, but always be open to reasonable requests to accommodate that timeframe to hold a unit. Just so you are aware, it is the standard line from the housing authorities that you can just hold the unit in the same amount of time that you would hold any other unit. But I’m telling you from a practical standpoint, that is not the case. If you only hold units for 72 hours, you are going to have to hold units a little bit longer to allow the housing authorities to come out and do their inspection.
All right. Source of income, still talking about source of income and lease termination. So, when you are terminating for non-payment, you are only going to be terminating for non-payment on the tenant’s portion. So, you cannot terminate if the housing authority has decided for some reason to withhold payment. Maybe the unit failed an inspection, whatever it might be, and the housing authority has given you notice that they’re going to cease making payments temporarily or permanently. That is an issue with your HAP contract with the housing authority, not termination of the tenant’s right to occupancy. So, the tenant’s termination is going to be based on their portion only. If you’ve got a case where the housing authority has stopped paying, but the tenant keeps paying their small share, you cannot terminate that tenant’s tenancy. So, you’ve got to take it up with the housing authority. But if the housing authority is making their payments but the tenant is not paying their portion, that’s when you’re going to be terminating for non-payment and then obviously you can still terminate for conduct issues of that tenant with your normal termination notices. The difference is you do need to send a copy of the termination notice to the housing authority or the subsidy program so that they can be aware and start processing moving papers and everything they need to do on their end to ensure that that tenant is going to be able to move somewhere new once they’re out.
All right, so let’s talk about the Safety Act. So, this was another new Illinois statute that was adopted in 2022. It is already effective. It was very controversial for landlords based on one issue, and that was that police officers were restricted from making arrests for trespassing. This became a really big issue because the Illinois eviction statute talks about criminal trespassing after a barred person notice is issued. So, if there is a guest or an unauthorized occupant who is really a problem at the property, the Illinois Eviction Act allows you to issue what they call a barred person notice, you have to serve it personally on that guest or that person and once that barred person, that guest has received the notice, if they won’t leave at that moment or if they come back onto the property, you have the right to call the police and the Illinois Eviction Act says and pursue charges and have them arrested for criminal trespassing. Well, the Safety Act came out and said, well, officers’ hands are tied, they’re not allowed to make arrests for trespassing. And landlords all went, oh, that’s not okay, that’s not okay. We’ve had this right. We do what we’re supposed to do, we issue our barred person notice, we have very little recourse, right?
I mean, there’s very little recourse when you are having problem guests as it is. So, often police officers arrive at the scene and kind of say, oh, it’s a civil matter, we don’t want to deal with it anyway, so taking more remedies away from you as landlords was really hard to swallow. And so, landlord groups and attorney groups and organizations all made a concerted effort down in Springfield to get some changes made and there actually has been a new amendment. That amendment is that it gives officers a little bit of leeway and a little bit of discretion in arresting for trespassing. So, the officer can only issue a citation if it’s not a felony or a class A misdemeanor, unless, and these three sub-bullet points there are the factors that an officer can consider to arrest for trespassing; If the officer reasonably believes there’s a threat to the community or if an arrest is necessary because the person continues to engage in the offensive conduct. So, on site, if the person is, you know– I mean, I’ve seen running around naked, right? I mean, running around the lobby of your building with no clothes on, screaming and having some type of episode. If that conduct continues in the officer’s presence, they have the right to arrest. Or if the person has an obvious medical or mental health issue that poses a risk to that person’s safety. Under those circumstances, police officers can still arrest for trespassing.
Now, threat that first one, if the officer reasonably believes there’s a threat to the community, this amendment to the act actually gives a definition of the word threat, which gives the officers actually, I think, a little bit more basis to arrest because I think otherwise that word is open to a lot of interpretation and sometimes police officers have very high thresholds for what they consider a threat because they’ve seen some bad stuff and what we may really consider threatening to our property, a police officer might not. So, I thought adding a little bit of a definition to threat should help our communities, let’s hope. So, a threat is defined as a real and present threat to the safety of any person or persons or the community based on the facts of the case. So, if anyone at the property is feeling endangered, if property at the building, in the community is in danger of being destroyed, all of these things can be factors that the police should be considering whether to arrest. So, when we talk about that barred person notice, I’ve had a lot of questions, is it even worth it? Should we not even be issuing barred person notices anymore if we have a problem with a guest? Cause it sounds like officers aren’t going to be making arrests for criminal trespassing and my advice is to still issue those notices.
One, the barred person notice is a really good deterrent. So, once a guest who is a problem or unauthorized occupant receives a barred person notice, there’s some pretty strong language in there and it may actually keep that guest from returning to the property with the threat of criminal trespassing worded in the notice. Two, if there is any chance that officers are going to arrest that person when they come back on the property, they’re only going to do it if you have that barred person. So, you really, really need to issue the barred person notice to have any chance of the officers making sure that they [Inaudible:21:57]. I do a seminar for, oh my God, I hope I can get the name of this right, the Crime Free Coalition and it’s the group of all of the police officers who run the crime-free program in their municipality. They all get together twice a year and do legal updates and talk about what’s going on in their municipalities and any changes they’ve made to their crime-free ordinances and how they’ve been enforcing them and implementing them and it’s a really, really great group and I usually give them their legal update and I did this past fall and it was really interesting because we talked a lot about the Safety Act.
We talked about arresting for trespassing and while they absolutely understood and sympathized with the landlord’s position, they felt like, and this was prior to the amendment, I should I should say, this was prior to this amendment coming out, but they really felt that the Safety Act had superseded the eviction act and that their hands were tied and that even with a barred person notice that Safety Act really restricted them and that they would not be able to help landlords in this situation. So, now that we have this amendment that gives them the right to do it, I strongly suggest that you use the tool of the barred person notice to help the officers with the basis they need to make the arrest. Because I think we’re going to find that a lot of officers were either taught this is what the Safety Act says, you can’t arrest. They’ve probably gotten some information about the amendment, but they may still be a little bit afraid to make that arrest in that circumstance because of what their understanding of the Safety Act is. So, we want to definitely be able to give them as much basis as possible, which is our barred person notice.
So, old questions, is there a form barred person notice? There is no form notice that the state puts out that I know of. I usually prepare them for my clients so that I include all of the statutory language from the statute, and I’ve seen other attorneys’ forms as well. So, I would say reach out and contact your attorney or my office. So, the next question, what does a citation do? Nothing. That’s the ticket. So, it says if the guest does not meet any of those three criteria, the officer’s hands are tied and all they can do is issue a citation, which is a ticket, which as we know is not going to do much. I will say if the officers are unwilling to arrest the person, but they keep coming back on the property, be diligent in calling the police every single time, it at least may act as a deterrent and the person may end up staying away just cause they don’t want to have to deal with the police every time they set foot on the property. Another question, how do you find out who the guest is, or can you do it against the tenant? That’s a really good question because a lot of times we don’t know who the person is.
So, I have issued barred person notices, not knowing the guest’s name, but using a description of the person. So, we just put unknown guest, I have blanks at the top of mine for this type of notice, and we fill in race, hair color, eye color, height, weight, build, male or female and try and give a really, really good description and then when the police officers arrive, security concierge onsite manager can tell the police, yes, he matches the description and he is the same person that we issued this notice to. Follow-Up question to that is, can we issue this notice on the tenant if we don’t know who the guest is? The statute actually says that you need to issue the barred person notice against the person who is trying to bar. However, unless the tenant is actually a victim of domestic violence or something and doesn’t want the guest to come onto the property, the tenant is responsible for all the actions of the guest. So, my advice to clients is always to issue the barred person notice along with a 10 day notice to the tenant telling the tenant that they’re in breach of the lease based on the guest’s conduct and then we give them a copy of the barred person notice and let them know that if the person is seen on the property, again, that is an ongoing breach of the lease and we would enforce the 10 day notice.
So, there is a way to involve the tenant and set up those remedies against the tenant as well. But you would not actually serve the barred person notice only on the tenant. You have to serve it on the guest in order to remove or have the police actually remove that barred person.
So, the next act we are going to talk about is the Illinois Smoke Detector Act. This shouldn’t be a huge change for most of you. So, I’m not going to spend a bunch of time on it. This was passed back in 2021 to update the smoke detector Act. There was an exception to this act for any municipalities with a population of over a million inhabitants. So, now this act is applicable everywhere. In addition, right after that, or around the same time, Chicago passed an ordinance that aligns with the state law so that the standards are uniform in Chicago and the rest of the state. So, that there would not be confusion in enforcement, which is nice. Thank you, Chicago. Usually, you like to go do your own thing and make things confusing, just a bit. So, in this case, they actually aligned with everybody. So, there were some things in the act that became effective January 1st, 2023, which is why it’s relevant now, right? You’re like, why is this a legal update? We’re talking about something in 2021. It’s because starting January 1st of this year, single and multi-family Illinois homeowners, rental homes need to use smoke detectors featuring 10-year batteries and these sealed battery smoke alarms.
So, these need to be installed. There are some exceptions we’re going to talk about in just a minute, but you do need to go through your rental properties and make sure that you have 10-year batteries and in Chicago, these sealed battery smoke alarms installed in your rental properties. Now, until you have the sealed battery smoke alarms, the tenants of rented units will still continue to be responsible for replacing the batteries, which is usually how most leases read that the tenants are responsible. So, let’s talk about these requirements quickly. Your smoke detectors either can be battery powered provided the battery is self-contained, not removable, long-term battery, we’re talking the 10-year batteries, wired into the structures or it could be wired into your power line, but they do not need to be all interconnected. So, if you have a hardwired smoke alarm, that’s fine too. Every dwelling unit has to be equipped with at least one of these types of smoke detectors in an operating condition within 15 feet of every bedroom, any room used for sleeping purposes, usually a bedroom. The smoke detector has to be installed on the ceiling and at least six inches away from any wall or on a wall located between four and six inches from the ceiling and every single-family residence has to have at least one approved smoke detector installed on every story of the dwelling unit including basements, but not including an unoccupied attic.
Now, there are some exceptions, this will apply I think usually in newer construction because these are more hardwired or alarm systems. So, fire alarms, smoke detectors, smoke alarms or other components that are electronically connected as part of a centrally monitored or supervised alarm system. Those do not have to comply with this 10-year battery and sealed battery requirement because they’re hardwired in and they’re part of a big smoke alarm system. Then we’ve got fire alarms, smoke detectors, smoke alarms that use a low powered radio frequency wireless communication system. So, if you’ve got some type of wireless smoke detector that will not have to comply or if there is any kind of Wi-Fi local area networking capability. I mean it’s; I love how the legislator’s kind of word all of this. Basically Wi-Fi, internet, remote, we’ve got our nest devices and all of those types of things. They were trying to cover those bases in the most convoluted legal ease that they could find.
So, basically if you have an alarm system and your smoke detectors are part of an overall centrally monitored smoke alarm system or if you have wireless smoke detectors, those are accepted from the requirement for this 10-year battery or sealed battery requirement. Interesting question, what if it’s a loft space that opens to the downstairs with tall ceilings? Does the lower level need a detector on the wall? I would say you may want to double check with your municipality. They will be checking these things. You can even call the fire department and maybe ask an anonymous question how they would recommend that you comply? But you definitely want to make sure that you are fulfilling the requirement that the smoke detector is within 15 feet of the bedroom. So, that is number one. If you can get the detector within 15 feet of the bedroom and it also is on the ceiling of what would be considered the loft area, you may be complying with both of those requirements, but I would actually put a call into the fire department. I’m sure they would just answer that nicely and anonymously and get that answer for you.
All right. You do get a 90-day warning for the violation, which is nice. So, you get three months to correct it if the municipality or the state finds that you have not complied. However, if you do not comply after those 90 days, they come back out to reinspect and you have not complied, you can get a fine of up to a hundred dollars every 30 days if you are not in compliance and that will be capped at 1500. So, no reason to get any fines if you have three months to correct it. All right. Electric vehicle right to charge act. This is a proposed Chicago ordinance. So, I want to be very, very clear. This is proposed legislation in the works. It looks like this legislation or some similar version of it is going to go through. This is important to the city council. So, I just kind of want to keep everybody on alert and aware this or some version of this is probably going to be coming down the pipeline sooner rather than later. So, it would require landlords to allow tenants to install electric vehicle charging stations in the garage parking lot wherever they park their cars.
Now, the landlord would be able to set out requirements for the installation if there’s extra utility charges or upgraded wiring, those costs have to be paid by the tenant. Landlords can restrict access to it to just that tenant so it’s not 15 cars pulling in to get charged and safety restrictions as well. So, in the ordinance there was a long, long list of all of the rights that landlords will have in supervising and monitoring and setting requirements for the installation, but it does not change the fact that tenants would have the right to install electric vehicle charging stations on your property. So, a really, really interesting concept that’s coming down that the city is very passionate about. So, we’re watching for that. Again, we will have email blasts going out if and when this is adopted with the actual requirements that are finalized but I thought it was important to bring up and let everybody know in our legal update.
All right, now I’m going to just have a few legal updates that are still pending, I still get questions about and so these are kind of my reminders to everybody as we enter 2023. So, one of the common mistakes we are seeing is landlords are still using or abiding by restrictions that were in place during the pandemic that you do not have to abide by, that have gone by the wayside by this point. So, obviously I think everybody knows the governor’s eviction moratorium, the ban on evictions has been lifted. We can move forward with evictions for non-payment for conduct and the process is very, very similar. If you wanted to start an eviction toward the end of the eviction ban, you may remember there was that tenant declaration form that had to be signed before you served your termination notice, that has been gone since October of 2021. So, no need to serve that tenant declaration form. I actually received one from a client a month ago, all signed and served with their five-day notice. So, you do not have to do that. We don’t want tenants to think that they have rights that they no longer have.
The one item that is still in effect is the CARES Act. This was a federal act, I don’t even know how many hundreds of pages long, but there was one section that affected landlords that said if a landlord with a federally backed mortgage on their rental property wanted to serve a notice for nonpayment, which in Illinois is our five day notice, the landlord had to give a 30 day period for repayment instead of five days. This is still in effect. I will say it’s my understanding National Apartment Association has filed suit against the federal government to kind of wake them up and say, Hey, you never repealed this, we’ve got landlords out there who are still complying with this 30 days and we’re kind of watching that and waiting to see what will happen there and hopefully this will get repealed and this requirement will lift. So, if you have a federally backed mortgage on your rental property, your lender Freddie Mac, Fannie Mae will require you to send a termination notice that gives the tenant 30 days to pay in full instead of five.
Now, it’s important to point out that I am saying your lender is requiring this. Generally, the courts are not. We have yet to see a judge enforce this if we have a federally backed property and the landlord used a five-day notice. Judges agree that this is a requirement that only relates to the lender and does not supersede what the Illinois Eviction Act allows, which is a five-day notice. Now, I am not telling you to circumvent and ignore this act because there would be penalties from your lender if you have a federally backed mortgage, but I am telling you if you understand that risk and you’re willing to accept that risk that you could have penalties from your lender, you could move forward with a five day notice in court is what it appears to be from the judges. But in my opinion, I always consider myself a risk manager to my clients to analyze the risk and give my clients a recommendation based on how risky certain decisions are. And in this case, I think it’s awfully risky to serve a five-day notice if you have a federally backed mortgage, especially if you know you’re serving five to 10 notices a month. If you have a large building and you have a lot of notices every month, you could get in a lot of trouble with your lenders. So, that is a pandemic leftover that is still in effect. We’re watching it carefully and hoping that it gets repealed. But for now, if you have a federally backed mortgage, I do recommend that you send a 30-day notice for non-pay.
The rental assistance is still a pandemic leftover that has actually really helped resolve a lot of evictions and avoid a lot of evictions and get some landlords paid. Just so everyone knows some of the issues that come up, you can proceed with an eviction notice and the eviction lawsuit while the application for rental assistance is pending. But if you are granted that money and you receive the money for rental assistance and you have gone ahead and filed the eviction lawsuit, you will be required to dismiss the eviction. So, even if a balance remains, let’s say they have a $20,000 balance, you’ve got a check for 15,000, you will have to dismiss the eviction lawsuit even though there’s a $5,000 balance remaining. I do want to talk judge’s interpretation here. And so, earlier with rental assistance, when the eviction ban first lifted, we had some judges arguing that under Illinois law, a landlord has a duty to mitigate the tenant’s inability to pay rent and judges felt that if a landlord choose not to apply for rental assistance, then the landlord was failing to mitigate the tenant’s damages. We’ve successfully argued against those numerous times. I don’t think any of the judges are enforcing that idea anymore.
Usually, a landlord is more than willing to accept that money if it’s only a non-payment issue and the tenant is otherwise a good tenant and really, we’ve only seen clients choose not to apply for rental assistance when there are other issues with that tenant. And so, the second the judge would say, well, they’re failing to mitigate, and we would explain, but once they accept, they have to keep the tenant and the tenant has all of these other issues, judge, then the judge would be willing to allow the case to go on. So, that really has not become an issue recently. So, you can choose not to fill out your portion of the application and not to accept rental assistance if it is more important to remove the tenant from the property. We do have the ERP program, which is a mandatory mediation program in Cook County. It is causing terrible delays in Cook County. We will talk about that more in February at the eviction seminar with a little update on what’s going on in Cook County. But this ERP program does arise from pandemic related guidelines that were issued by the Supreme Court.
We also, as a reminder, the Cook County RTLO went into effect June of 2021. It’s a lot like the Chicago RLTO and governs the landlord tenant relationship in all properties in Cook County. So, if you are a smaller landlord with properties in Cook County and you have not yet heard about the Cook County RLTO, my guess is your lease is not in compliance, you’re probably not issuing non-renewal notices in compliance, you may not be complying with security deposit requirements. So, there’s a lot in there and it’s really, really important that you comply with it because just like Chicago, there are steep penalties against landlords. I will say that the Cook County RTLO states that municipalities that have really detailed robust landlord tenant ordinances of their own would be exempt and would not have to follow the Cook County ordinance. So, that would include Chicago, Evanston, Oak Park, Mount Prospect, those are all municipalities that have really, really substantial landlord tenant ordinances of their own.
Pay and stay, this is a Chicago and Cook County only issue. In their ordinances, in the Chicago and Cook County RTLO and RLTO and it’s important for all Cook County Chicago landlords to understand that during the eviction process, if the tenant makes payment in full of their rent plus the court costs, but it doesn’t include late fees or attorney’s fees, then we have to dismiss the case and the tenant gets to stay. The payment has to be made before the eviction order is entered and it is only a one time right. So, if the tenant uses this right and makes payment in full of the balance of rent plus court costs, gets to stay in the property and then they fall behind in rent again and we have to file a second eviction lawsuit against them, they cannot use this right again. They do not get the right to pay and stay. Now, the practical application that I keep reminding clients is that if you have a tenant who offers payment in full during the eviction case, send us an email quick to get the amount of court costs because it’s great that you’re getting that 3,500 bucks in rent that you’re owed, but you are also entitled and in Cook County it can be like 7, 800 dollars in court costs and you are entitled to that payment before the tenant has the right to have the case dismissed.
So, I get a lot of emails from clients saying, hey, the tenant paid in full, dismiss the case. I’m like, did you get the court costs? You’re allowed to ask for those court costs. Don’t talk yourself out of every penny that you can get under the ordinance. We are allowed this extra little tidbit here, so let’s grab it. So definitely when a tenant offers to pay in full, get the amount of court costs so that you can add it to the tenant’s balance and get paid with everything. Another reminder, just housing ordinance. This went into effect a while ago, three years ago now. It was January 2020, but I still get questions. I still have smaller landlords who are not familiar with it. It is a Cook County ordinance, applied to all of Cook County, including Chicago. You cannot look at a tenant’s or an applicant’s criminal background more than three years back from the date of the application. So, you only get a three-year window, and you cannot consider arrests. So, it has to just be convictions in the last three years. You also have to bifurcate your screening process. They have to be approved on credit income and rental history first. If they’re approved on those grounds, then you can inquire and run the criminal background.
A lot of the big screening companies know this. They already have set up a bifurcated screening process but if you are doing this on your own, you have to be really, really careful not to even ask questions on your application about criminal background. You have to run those other issues first and approve the tenant there before you move on to criminal background. It has a very detailed procedure. There are four or five required notices that you have to give throughout the application process. So, if you are a Cook County landlord and you are not screening tenants in compliance with the just housing ordinance, please let me know. I’d be happy to get you in compliance. A couple of quick questions. So, one is on rental assistance. If the rental assistance does not cover the entire balance owed, do you have to file another eviction? And unfortunately, the answer is yes. If we’re in the eviction process, you receive rental assistance or like my example, they owe 20,000, you get 15,000, we have to dismiss that eviction case and you would have to serve a new five-day notice for the remaining balance, then file a new eviction for that remaining balance. So, that can be very, very frustrating for clients.
The Cook County RTLO can be found on the Cook County website. We also have it on ksnlaw.com under education. We have an education tab that has all of the statutes and ordinances related to landlord tenant law and you can also find our blogs and articles there. Question, are you entitled to court costs if accepting rental assistance payment? Generally, no, some of the charitable organizations will include the court costs. Some up in McHenry County even include the attorney’s fees. So, it will depend on the charitable organization. IDA does not, housing authority of Cook County does not. It is just the back rent plus three months of future rent generally is their standard to try and get them paid in full and although that’s their standard, sometimes my clients are not getting the full payment to cover the entire balance or it takes so long to process it and get the check that by the time they get the check it’s four months down the road and the check they get has covered the three months of future rent that have actually already passed since the date of the application and the tenant is still behind on that fourth month.
So, with regard to criminal background, quick question about sexual offenders. Yes, there is an exception for sexual offenders. I will say we are doing a seminar in the spring on the just housing ordinance in detail, so watch for that. I think it will be on our calendar of events at ksnlaw.com and I will go into much more detail there. And yes, just the housing ordinance was a Cook County ordinance only applies to Cook County. We have blank leases in compliance for 2023. I do have form leases, feel free to email me. We obviously do charge for our form leases, but I would be happy to give you the details. And so yes, we are doing Cook County RTLO as well. There’s a comment here about Oak Park. Oak Park did adopt what is essentially the Cook County RTLO, but I will say there are about five discrepancies between the Cook County RTLO requirements and the Oak Park ordinance. It literally looks exactly the same line by line, by line by line and then you will find if you read it very, very carefully, there are just a few differences. So, it’s very, very interesting. Oak Park is still considered exempt because they adopted their own robust landlord tenant ordinance, but it is essentially the exact same requirements as Cook County. So, I appreciate you pointing that out.
All right, so I hit as many questions as I could. There was a lot to cover. I appreciate everybody’s patience going over in time just a little bit here. If you have questions that I was not able to get to or that were specific to your tenant or your property, you can feel free to reach out. If we do not currently represent you, I would ask that you go through our LAMP website on our ksnlaw.com. You can look for LAMP or just Google KSN Law Lamp, L.A.MP. You’ll be able to fill out all of your information and submit it so that we can get you all signed up and get your contact information in our system and we can start working together. So, thank you so much for joining me today and have a great rest of your afternoon. Thank you.
Bernie: That was KSN attorney Jessica Ryan. Jessica is the head of KSN’s Landlord tenant Department. Our firm is an experienced legal resource ready to provide landlords and property managers with quality advice and exceptional service. We look forward to demonstrating how we have earned the trust of thousands of clients over the past 40 years. If you’d like to reach Jessie or any of KSN’s experienced attorneys, please call 855-537-0500. You can also visit our website, ksnlaw.com, and complete the contact form to send a message. Thanks for listening.
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