99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
HB2640
 
Introduced , by Rep. Kelly M. Cassidy
 
SYNOPSIS AS INTRODUCED:






765 ILCS 605/18 from Ch. 30, par. 318

 Amends the Condominium Property Act. Makes changes in provisions governing: portions of board of managers' meetings which may be closed to the unit owners; participation by board members in meetings via acceptable technological means; and notice requirements for board of managers meetings.



LRB099 07615 HEP 27746 b


 
 
A BILL FOR
 


HB2640LRB099 07615 HEP 27746 b



1 AN ACT concerning civil law.


2 Be it enacted by the People of the State of Illinois,

3represented in the General Assembly:



4 Section 5. The Condominium Property Act is amended by 
5changing Section 18 as follows:



6 (765 ILCS 605/18) (from Ch. 30, par. 318)


7 Sec. 18. Contents of bylaws. The bylaws shall provide for 
8at least
the following:


9 (a)(1) The election from among the unit owners of a board 
10of managers,
the number of persons constituting such board, and 
11that the terms of at
least one-third of the members of the 
12board shall expire annually and that
all members of the board 
13shall be elected at large.
If there are multiple owners of a 
14single unit, only one of the multiple
owners shall be eligible 
15to serve as a member of the board at any one time.


16 (2) the powers and duties of the board;


17 (3) the compensation, if any, of the members of the board;


18 (4) the method of removal from office of members of the 
19board;


20 (5) that the board may engage the services of a manager or 
21managing agent;


22 (6) that each unit owner shall receive, at least 30 days 
23prior to the
adoption thereof by the board of managers, a copy 
 
 
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1of the proposed annual
budget together with an indication of 
2which portions are intended for
reserves, capital expenditures 
3or repairs or payment of real estate taxes;


4 (7) that the board of managers shall annually supply to
all 
5unit owners an itemized accounting of the common expenses
for 
6the preceding year actually incurred or paid, together
with an 
7indication of which portions were for reserves, capital

8expenditures or repairs or payment of real estate taxes and

9with a tabulation of the amounts collected pursuant to the

10budget or assessment, and showing the net excess or
deficit of 
11income over expenditures plus reserves;


12 (8)(i) that each unit owner shall receive notice, in the 
13same manner
as is provided in this Act for membership meetings, 
14of any meeting of the
board of managers concerning the adoption 
15of the proposed annual budget and
regular assessments pursuant 
16thereto or to adopt a separate (special)
assessment, (ii) that 
17except as provided in subsection (iv) below, if an
adopted

18budget or any separate assessment adopted by the board would 
19result in the
sum of all regular and separate assessments 
20payable in the current fiscal year
exceeding 115% of the sum of 
21all regular and separate
assessments payable during the

22preceding fiscal year, the
board of managers, upon written 
23petition by unit owners with 20 percent of
the votes of the 
24association delivered to the board within 14
days of the board 
25action,
shall call a meeting of the unit owners within 30 days 
26of the date of
delivery of the petition to consider the budget 
 
 
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1or separate
assessment; unless a
majority of
the total votes of 
2the unit owners are cast at the meeting to reject the
budget or 
3separate assessment,
it is ratified, (iii) that any common 
4expense not set forth in the budget or
any increase in 
5assessments over the amount adopted in the budget shall be

6separately assessed against all unit owners, (iv) that separate 
7assessments for
expenditures relating to emergencies or 
8mandated by law may be adopted by the
board of managers without 
9being subject to unit owner approval or the
provisions of item 
10(ii) above or item (v) below. As used
herein, "emergency" means 
11an immediate danger to the structural integrity of
the
common 
12elements or to the life, health, safety or property of the unit 
13owners,
(v) that assessments
for additions and alterations to 
14the common elements or to association-owned
property not 
15included in the adopted annual budget, shall be separately

16assessed and are subject to approval of two-thirds of the total 
17votes of all
unit owners, (vi) that the board of managers may 
18adopt separate assessments
payable over more than one fiscal 
19year. With respect to multi-year assessments
not governed by 
20items (iv) and (v), the entire amount of the multi-year

21assessment shall be deemed considered and authorized in the 
22first fiscal year
in which the assessment is approved;


23 (9)(A) that every meeting meetings of the board of managers 
24shall be open to any unit
owner, except for the portion of any 
25meeting held (i) to discuss or consider information relating 
26to: (i) litigation
when an action against or on behalf of the 
 
 
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1particular association has been
filed and is pending in a court 
2or administrative tribunal,
or when the board of managers finds 
3that such an action is probable
or imminent, (ii) to consider 
4information regarding appointment, employment
or dismissal of 
5an employee, or (iii) to discuss violations of rules and

6regulations of the association, or (iv) a unit owner's unpaid 
7share of common
expenses; that any vote on these matters 
8discussed or considered in closed session shall take place be 
9taken at a meeting of the board of managers or
portion thereof 
10open to any unit owner;
11 (B) that board members may participate in and act at any 
12meeting of the board of managers in person, by telephonic 
13means, or by use of any acceptable technological means whereby 
14all persons participating in the meeting can communicate with 
15each other; that participation constitutes attendance and 
16presence in person at the meeting;
17 (C) that any unit owner may record the
proceedings at 
18meetings of the board of managers or portions thereof required 
19to be open by this
Act by tape, film or other means, and ; that 
20the board may prescribe reasonable
rules and regulations to 
21govern the right to make such recordings; ,
22 (D) that
notice of every meeting of the board of managers 
23such meetings shall be given to every board member mailed or 
24delivered at least 48 hours
prior thereto, unless the board 
25member waives notice of the meeting pursuant to subsection (a) 
26of Section 18.8; a written waiver of such notice is signed by 
 
 
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1the
person or persons entitled to such notice pursuant to the 
2declaration,
bylaws, other condominium instrument, or 
3provision of law other than this
subsection before the meeting 
4is convened, and
5 (E) that notice copies of notices of every meeting
meetings 
6of the board of managers shall be posted in entranceways,

7elevators, or other conspicuous places in the condominium at 
8least 48 hours
prior to the meeting of the board of managers 
9except where there is no
common entranceway for 7 or more 
10units, the board of managers may designate
one or more 
11locations in the proximity of these units where the notices of

12meetings shall be posted; that notice of every meeting of the 
13board of managers shall also be given at least 48 hours prior 
14to the meeting, or such longer notice as this Act may 
15separately require, to: (i) each unit owner who has provided 
16the association with written authorization to conduct business 
17by acceptable technological means, and (ii) to the extent that 
18the condominium instruments of an association require, to each 
19other unit owner, as required by subsection (f) of Section 
2018.8, by mail or delivery, and that no other notice of a 
21meeting of the board of managers need be given to any unit 
22owner;


23 (10) that the board shall meet at least 4 times annually;


24 (11) that no member of the board or officer shall be 
25elected for a term
of more than 2 years, but that officers and 
26board members may succeed
themselves;


 
 
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1 (12) the designation of an officer to mail and receive all 
2notices and
execute amendments to condominium instruments as 
3provided for in this Act
and in the condominium instruments;


4 (13) the method of filling vacancies on the board
which 
5shall include authority for the remaining members of the board 
6to
fill the vacancy by two-thirds vote until the next annual 
7meeting of unit
owners or for a period terminating no later 
8than 30 days following the
filing of a petition signed by unit 
9owners holding 20% of the votes of the
association requesting a 
10meeting of the unit owners to fill the vacancy for
the balance 
11of the term, and that a meeting of the unit owners shall be

12called for purposes of filling a vacancy on the board no later 
13than 30 days
following the filing of a petition signed by unit 
14owners holding 20% of the
votes of the association requesting 
15such a meeting, and the method of filling
vacancies among the 
16officers that shall include the authority for the members
of 
17the board to fill the vacancy for the unexpired portion of the 
18term;


19 (14) what percentage of the board of managers, if other 
20than a majority,
shall constitute a quorum;


21 (15) provisions concerning notice of board meetings to 
22members of the
board;


23 (16) the board of managers may not enter into a contract 
24with a
current board member
or with a corporation or 
25partnership in which a board
member or a member of the board 
26member's immediate family has 25% or
more interest, unless 
 
 
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1notice of intent to enter the
contract is given to unit owners 
2within 20 days after a decision is made
to enter into the 
3contract and the unit owners are
afforded an opportunity by 
4filing a petition, signed by 20% of the unit
owners, for an 
5election to approve or disapprove the contract;
such petition 
6shall be filed within 20 days after such notice and such

7election shall be held within 30 days after filing the 
8petition; for purposes
of this subsection, a board member's 
9immediate family means the board member's
spouse, parents, and 
10children;


11 (17) that the board of managers may disseminate
to unit 
12owners biographical and background information about 
13candidates for
election to the board if (i) reasonable efforts 
14to identify all candidates are
made and all candidates are 
15given an opportunity to include biographical and
background 
16information in the information to be disseminated; and (ii) the

17board does not express a preference in favor of any candidate;


18 (18) any proxy distributed for board elections
by the board 
19of managers gives unit owners the
opportunity to designate any 
20person as the proxy holder, and gives the unit
owner the 
21opportunity to express a preference for any of the known

22candidates for the board or to write in a name;


23 (19) that special meetings of the board of managers can be 
24called by
the president or 25% of the members of the board; and


25 (20) that the board of managers may establish
and maintain 
26a system of master metering of public utility services and

 
 
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1collect payments in connection therewith, subject to the 
2requirements of the
Tenant Utility Payment Disclosure Act.


3 (b)(1) What percentage of the unit owners, if other than 
420%, shall
constitute a quorum provided that, for condominiums 
5with 20 or more units,
the percentage of unit owners 
6constituting a quorum shall be 20% unless the
unit owners 
7holding a majority of the percentage interest in the

8association provide for a higher percentage, provided that in 
9voting on amendments to the association's bylaws, a unit owner 
10who is in arrears on the unit owner's regular or separate 
11assessments for 60 days or more, shall not be counted for 
12purposes of determining if a quorum is present, but that unit 
13owner retains the right to vote on amendments to the 
14association's bylaws;


15 (2) that the association shall have one class of 
16membership;


17 (3) that the members shall hold an annual meeting, one of 
18the purposes
of which shall be to elect members of the board of 
19managers;


20 (4) the method of calling meetings of the unit owners;


21 (5) that special meetings of the members can be called by 
22the president,
board of managers, or by 20% of unit owners;


23 (6) that written notice of any membership meeting shall be 
24mailed
or delivered giving members no less than 10 and no more 
25than 30 days
notice of the time, place and purpose of such 
26meeting except that notice may be sent, to the extent the 
 
 
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1condominium instruments or rules adopted thereunder expressly 
2so provide, by electronic transmission consented to by the unit 
3owner to whom the notice is given, provided the director and 
4officer or his agent certifies in writing to the delivery by 
5electronic transmission;


6 (7) that voting shall be on a percentage basis, and that 
7the percentage
vote to which each unit is entitled is the 
8percentage interest of the
undivided ownership of the common 
9elements appurtenant thereto, provided
that the bylaws may 
10provide for approval by unit owners in connection with
matters 
11where the requisite approval on a percentage basis is not 
12specified
in this Act, on the basis of one vote per unit;


13 (8) that, where there is more than one owner of a unit, if 
14only one
of the multiple owners is present at a meeting of the 
15association, he is
entitled to cast all the votes allocated to 
16that unit, if more than one of
the multiple owners are present, 
17the votes allocated to that unit may be
cast only in accordance 
18with the agreement of a majority in interest of the
multiple 
19owners, unless the declaration expressly provides otherwise, 
20that
there is majority agreement if any one of the multiple 
21owners cast the
votes allocated to that unit without protest 
22being made promptly to the
person presiding over the meeting by 
23any of the other owners of the unit;


24 (9)(A) except as provided in subparagraph (B) of this 
25paragraph (9) in
connection with board elections, that
a unit 
26owner may vote by proxy executed in writing by the unit
owner 
 
 
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1or by his duly authorized attorney in fact; that the proxy must 
2bear the date of
execution
and, unless the condominium 
3instruments or the written proxy itself provide
otherwise, is

4invalid after 11 months from the date of its execution; to the 
5extent the condominium instruments or rules adopted thereunder 
6expressly so provide, a vote or proxy may be submitted by 
7electronic transmission, provided that any such electronic 
8transmission shall either set forth or be submitted with 
9information from which it can be determined that the electronic 
10transmission was authorized by the unit owner or the unit 
11owner's proxy;


12 (B) that if a rule adopted at least 120 days before a board 
13election
or the
declaration or bylaws provide for balloting as 
14set forth in this subsection,
unit
owners may not vote by proxy 
15in board elections, but may vote only (i) by
submitting an 
16association-issued ballot in person at the election meeting or

17(ii) by
submitting an association-issued ballot to the 
18association or its designated
agent
by mail or other means of 
19delivery specified in the declaration, bylaws, or
rule; that

20the ballots shall be mailed or otherwise distributed to unit 
21owners not less
than 10
and not more than 30 days before the 
22election meeting, and the board shall give
unit owners not less 
23than 21 days' prior written notice of the deadline for

24inclusion of a candidate's name on the ballots; that the 
25deadline shall be no
more
than 7 days before the ballots are 
26mailed or otherwise distributed to unit
owners; that
every such 
 
 
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1ballot must include the names of all candidates who have given 
2the
board or its authorized agent timely written notice of 
3their candidacy and must
give the person casting the ballot the 
4opportunity to cast votes for candidates
whose names do not 
5appear on the ballot; that a ballot received by the
association

6or
its designated agent after the close of voting shall not be 
7counted; that a
unit
owner
who submits a ballot by mail or 
8other means of delivery specified in the
declaration, bylaws, 
9or rule may request and cast a ballot in person at the
election

10meeting, and thereby void any ballot previously submitted by 
11that unit owner;
12 (B-5) that if a rule adopted at least 120 days before a 
13board election or the declaration or bylaws provide for 
14balloting as set forth in this subparagraph, unit owners may 
15not vote by proxy in board elections, but may vote only (i) by 
16submitting an association-issued ballot in person at the 
17election meeting; or (ii) by any acceptable technological means 
18as defined in Section 2 of this Act; instructions regarding the 
19use of electronic means for voting shall be distributed to all 
20unit owners not less than 10 and not more than 30 days before 
21the election meeting, and the board shall give unit owners not 
22less than 21 days' prior written notice of the deadline for 
23inclusion of a candidate's name on the ballots; the deadline 
24shall be no more than 7 days before the instructions for voting 
25using electronic or acceptable technological means is 
26distributed to unit owners; every instruction notice must 
 
 
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1include the names of all candidates who have given the board or 
2its authorized agent timely written notice of their candidacy 
3and must give the person voting through electronic or 
4acceptable technological means the opportunity to cast votes 
5for candidates whose names do not appear on the ballot; a unit 
6owner who submits a vote using electronic or acceptable 
7technological means may request and cast a ballot in person at 
8the election meeting, thereby voiding any vote previously 
9submitted by that unit owner; 


10 (C) that if a written petition by unit owners with at least 
1120% of the
votes of
the association is delivered to the board 
12within 14 days after the board's
approval
of a rule adopted 
13pursuant to subparagraph (B) or subparagraph (B-5) of this 
14paragraph (9), the board
shall call a meeting of the unit 
15owners within 30 days after the date of
delivery of
the 
16petition; that unless a majority of the total votes of the unit 
17owners are
cast
at the
meeting to reject the rule, the rule is 
18ratified;

19 (D) that votes cast by ballot under subparagraph (B) or 
20electronic or acceptable technological means under 
21subparagraph (B-5) of this paragraph (9) are valid for the 
22purpose of establishing a quorum; 

23 (10) that the association may, upon adoption of the 
24appropriate rules by
the board of managers, conduct elections 
25by secret ballot whereby the voting
ballot is marked only with 
26the percentage interest for the unit and the vote
itself, 
 
 
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1provided that the board further adopt rules to verify the 
2status of the
unit owner issuing a proxy or casting a ballot; 
3and further, that a candidate
for election to the board of 
4managers or such
candidate's representative shall have the 
5right to be present at the
counting of ballots at such 
6election;


7 (11) that in the event of a resale of a condominium unit 
8the purchaser
of a unit from a seller other than the developer 
9pursuant to an installment
contract for purchase shall during 
10such times as he or she resides in the
unit be counted toward a 
11quorum for purposes of election of members of the
board of 
12managers at any meeting of the unit owners called for purposes 
13of
electing members of the board, shall have the right to vote 
14for the
election of members of the board of managers and to be 
15elected to and serve
on the board of managers unless the seller 
16expressly retains in writing any
or all of such rights. In no 
17event may the seller and purchaser both be
counted toward a 
18quorum, be permitted to vote for a particular office or be

19elected and serve on the board. Satisfactory evidence of the 
20installment
contact shall be made available to the association 
21or its agents. For
purposes of this subsection, "installment 
22contact" shall have the same
meaning as set forth in Section 1 
23(e) of "An Act relating to installment
contracts to sell 
24dwelling structures", approved August 11, 1967, as amended;


25 (12) the method by which matters subject to the approval of 
26unit owners
set forth in this Act, or in the condominium 
 
 
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1instruments, will be
submitted to the unit owners at special 
2membership meetings called for such
purposes; and


3 (13) that matters subject to the affirmative vote of not 
4less than 2/3
of the votes of unit owners at a meeting duly 
5called for that purpose,
shall include, but not be limited to:


6  (i) merger or consolidation of the association;


7  (ii) sale, lease, exchange, or other disposition 
8 (excluding the mortgage
or pledge) of all, or substantially 
9 all of the property and assets of the
association; and


10  (iii) the purchase or sale of land or of units on 
11 behalf of all unit owners.

12 (c) Election of a president from among the board of 
13managers, who shall
preside over the meetings of the board of 
14managers and of the unit owners.

15 (d) Election of a secretary from among the board of 
16managers, who shall
keep the minutes of all meetings
of the 
17board of managers and of the unit owners and who shall, in 
18general,
perform all the duties incident to the office of 
19secretary.

20 (e) Election of a treasurer from among the board of 
21managers, who shall
keep the financial records and
books of 
22account.

23 (f) Maintenance, repair and replacement of the common 
24elements and
payments therefor, including the method of 
25approving payment vouchers.

26 (g) An association with 30 or more units shall obtain and 
 
 
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1maintain
fidelity insurance covering persons who control or 
2disburse funds of the
association for the maximum amount of 
3coverage available to protect funds
in the custody or control 
4of the association plus the association reserve
fund. All 
5management companies which are responsible for the funds held 
6or
administered by the association shall maintain and furnish 
7to the
association a fidelity bond for the maximum amount of 
8coverage available to
protect funds in the custody of the 
9management company at any time. The
association shall bear the 
10cost of the fidelity insurance and fidelity
bond, unless 
11otherwise provided by contract between the association and a

12management company. The association shall be the direct obligee 
13of any
such fidelity bond. A management company holding reserve 
14funds of an
association shall at all times maintain a separate 
15account for each
association, provided, however, that for 
16investment purposes, the Board of
Managers of an association 
17may authorize a management company to maintain
the 
18association's reserve funds in a single interest bearing 
19account with
similar funds of other associations. The 
20management company shall at all
times maintain records 
21identifying all moneys of each association in such
investment 
22account. The management company may hold all operating funds of

23associations which it manages in a single operating account but 
24shall at
all times maintain records identifying all moneys of 
25each association in
such operating account. Such operating and 
26reserve funds held by the
management company for the 
 
 
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1association shall not be subject to attachment
by any creditor 
2of the management company.

3 For the purpose of this subsection a management company 
4shall be
defined as a person, partnership, corporation, or 
5other legal entity
entitled to transact business on behalf of 
6others, acting on behalf of or
as an agent for a unit owner, 
7unit owners or association of unit owners for
the purpose of 
8carrying out the duties, responsibilities, and other

9obligations necessary for the day to day operation and 
10management of any
property subject to this Act. For purposes of 
11this subsection, the term
"fiduciary insurance coverage" shall 
12be defined as both a fidelity bond and
directors and officers 
13liability coverage, the fidelity bond in the full
amount of 
14association funds and association reserves that will be in the

15custody of the association, and the directors and officers 
16liability
coverage at a level as shall be determined to be 
17reasonable by the board of
managers, if not otherwise 
18established by the declaration or by laws.

19 Until one year after the effective date of this amendatory 
20Act of 1985,
if a condominium association has reserves plus 
21assessments in excess of
$250,000 and cannot reasonably obtain 
22100% fidelity bond coverage for such
amount, then it must 
23obtain a fidelity bond coverage of $250,000.

24 (h) Method of estimating the amount of the annual budget, 
25and the manner
of assessing and collecting from the unit owners 
26their respective shares of
such estimated expenses, and of any 
 
 
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1other expenses lawfully agreed upon.

2 (i) That upon 10 days notice to the manager or board of 
3managers and
payment of a reasonable fee, any unit owner shall 
4be furnished a statement
of his account setting forth the 
5amount of any unpaid assessments or other
charges due and owing 
6from such owner.

7 (j) Designation and removal of personnel necessary for the 
8maintenance,
repair and replacement of the common elements.

9 (k) Such restrictions on and requirements respecting the 
10use and
maintenance of the units and the use of the common 
11elements, not set forth
in the declaration, as are designed to 
12prevent unreasonable interference
with the use of their 
13respective units and of the common elements by the
several unit 
14owners.

15 (l) Method of adopting and of amending administrative rules 
16and
regulations governing the operation and use of the common 
17elements.

18 (m) The percentage of votes required to modify or amend the 
19bylaws, but
each one of the particulars set forth in this 
20section shall always be
embodied in the bylaws.

21 (n)(i) The provisions of this Act, the declaration, bylaws, 
22other
condominium instruments, and rules and regulations that 
23relate to the use
of the individual unit or the common elements 
24shall be applicable to
any person leasing a unit and shall be 
25deemed to be incorporated in any
lease executed or renewed on 
26or after the effective date of this amendatory
Act of 1984. 
 
 
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1(ii) With regard to any lease entered into subsequent to the

2effective date of this amendatory Act of 1989, the unit owner 
3leasing the
unit shall deliver a copy of the signed lease to 
4the board or if the
lease is oral, a memorandum of the lease, 
5not later than the date of
occupancy or 10 days after the lease 
6is signed, whichever occurs first. In
addition to any other 
7remedies, by filing an action jointly against the
tenant and 
8the unit owner, an association may seek to enjoin a tenant from

9occupying a unit or seek to evict a tenant under the provisions 
10of Article
IX of the Code of Civil Procedure for failure of the 
11lessor-owner to
comply with the leasing requirements 
12prescribed by
this Section or by the declaration, bylaws, and

13rules and regulations. The board of managers may proceed 
14directly against a
tenant, at law or in equity, or under the 
15provisions of Article IX of the
Code of Civil Procedure, for 
16any other breach by tenant of any
covenants, rules, regulations 
17or bylaws.

18 (o) The association shall have no authority to forbear the 
19payment
of assessments by any unit owner.

20 (p) That when 30% or fewer of the units, by number,
possess 
21over 50% in the aggregate of the votes in the association,
any 
22percentage vote of members specified herein or in the 
23condominium
instruments shall require the specified percentage 
24by number of units
rather than by percentage of interest in the 
25common elements allocated
to units that would otherwise be 
26applicable and garage units or storage units, or both, shall 
 
 
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1have, in total, no more votes than their aggregate percentage 
2of ownership in the common elements; this shall mean that if 
3garage units or storage units, or both, are to be given a vote, 
4or portion of a vote, that the association must add the total 
5number of votes cast of garage units, storage units, or both, 
6and divide the total by the number of garage units, storage 
7units, or both, and multiply by the aggregate percentage of 
8ownership of garage units and storage units to determine the 
9vote, or portion of a vote, that garage units or storage units, 
10or both, have. For purposes of this subsection (p), when making 
11a determination of whether 30% or fewer of the units, by 
12number, possess over 50% in the aggregate of the votes in the 
13association, a unit shall not include a garage unit or a 
14storage unit.


15 (q) That a unit owner may not assign, delegate, transfer, 
16surrender, or
avoid the duties, responsibilities, and 
17liabilities of a unit owner under this
Act, the condominium 
18instruments, or the rules and regulations of the
Association; 
19and that such an attempted assignment, delegation, transfer,

20surrender, or avoidance shall be deemed void.

21 The provisions of this Section are applicable to all 
22condominium
instruments recorded under this Act. Any portion of 
23a condominium
instrument which contains provisions contrary to 
24these provisions shall be
void as against public policy and 
25ineffective. Any such instrument which
fails to contain the 
26provisions required by this Section shall be deemed to

 
 
HB2640- 20 -LRB099 07615 HEP 27746 b


1incorporate such provisions by operation of law.

2(Source: P.A. 98-1042, eff. 1-1-15.)