103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB0202

 

Introduced 1/31/2023, by Sen. Laura M. Murphy

 

SYNOPSIS AS INTRODUCED:
 
New Act

    Creates the Vacancy Fraud Act. Provides that, on or after January 1, 2024, any owner of real property located in a county with 3,000,000 or more inhabitants may file a written vacancy fraud complaint alleging that: (i) certain real property in that county has received a decrease in assessed value, a decrease in market value, or an abatement of taxes because the property is vacant; and (ii) the owner of that vacant property is not actively attempting to sell or lease the property or actively attempting to alter or modify the property to prepare it for sale or lease. Sets forth factors for determining vacancy fraud. Provides that the owner of the vacant property may be subject to the following penalties: (1) the payment of 3 times the amount of back taxes owed for any vacancy reduction the subject property received for the period in which the subject property received the reduction but was found to have engaged vacancy fraud; and (2) the payment of interest on any back taxes. Effective immediately.


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A BILL FOR

 

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1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the
5Vacancy Fraud Act.
 
6    Section 5. Public policy. Certain commercial properties in
7Cook County receive a vacancy reduction because they are
8partly or completely vacant. In order to revitalize struggling
9commercial corridors and foster economic development in Cook
10County commercial corridors, it is imperative that owners of
11commercial properties that receive a vacancy reduction attempt
12to lease or sell those properties or make the alterations or
13modifications necessary to lease or sell those properties.
14    The General Assembly finds that it is against public
15policy for commercial property owners to receive a vacancy
16reduction without attempting to lease or sell those properties
17or make the modifications or alterations necessary to lease or
18sell those properties because it burdens homeowners and
19actively operating businesses, lessens the taxing districts'
20tax bases, and causes blight in commercial corridors.
 
21    Section 10. Definitions. As used in this Act:
22    "Subject property" means real property located in a county

 

 

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1with 3,000,000 or more inhabitants, or a portion of that
2property, that is designated or zoned for commercial or
3business use and receives a vacancy reduction. With respect to
4real property that is zoned or designated as mixed-use
5property, this Act applies only to that portion designated or
6zoned for commercial or business use.
7    "Vacancy reduction" means a decrease in assessed value, a
8decrease in market value, or an abatement of taxes by the chief
9county assessment officer, a board of review, a county, or a
10taxing district, which is permitted by ordinance, resolution,
11or policy granting such a decrease in assessed value to
12property that is vacant.
 
13    Section 15. Vacancy fraud complaints.
14    (a) The board of review in a county with 3,000,000 or more
15inhabitants is authorized to hear vacancy fraud complaints
16brought no more than 5 years after the vacancy fraud occurred.
17No vacancy fraud complaints may be brought for vacancy
18reductions that were granted prior to the effective date of
19this Act. If there is no actively installed or operating board
20of review, the chief county assessment officer is authorized
21to designate a department or official to hear those
22complaints. If the chief county assessment officer designates
23a department or official to hear complaints because there is
24no actively installed or operating board of review, then
25references to the board of review in this Act shall mean the

 

 

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1designated department or official.
2    (b) Beginning on January 1, 2024, any owner of real
3property located in a county with 3,000,000 or more
4inhabitants may file a written vacancy fraud complaint with
5the appropriately designated board of review within the
6applicable filing period set forth in subsection (a) alleging
7that the subject property has received a vacancy reduction and
8that the owner of the subject property is not actively
9attempting to lease, sell, alter, or modify the property to
10prepare it for sale or lease. The board of review shall
11determine the process by which a vacancy fraud complaint may
12be filed.
13    (c) Only one vacancy fraud complaint shall be considered
14and heard by the board of review for each instance a property
15received a vacancy reduction. The decision of the board of
16review shall be binding on future complaints based on the same
17vacancy fraud reduction in the same year. If more than one
18vacancy fraud complaint is pending concurrently, those
19complaints shall be consolidated.
20    (d) The party alleging vacancy fraud shall file the
21appropriate notice and documents, as prescribed by the board
22of review, in the manner determined by the board of review.
23Vacancy fraud complaints may be filed by the party alleging
24vacancy fraud or an attorney acting on that party's behalf.
25    (e) Upon receipt of a written complaint that is timely
26filed, the board of review shall process the complaint and

 

 

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1provide the appropriate notice to the property that is the
2subject of the complaint. The board of review that will hear
3the vacancy fraud complaint shall establish the process by
4which notice shall be provided and by which complaints shall
5be heard.
 
6    Section 20. Factors in determining vacancy fraud.
7    (a) In determining whether the owner of a subject property
8is actively attempting to sell or lease the subject property
9or actively attempting to modify or alter the subject property
10for sale or lease, the board may consider the following
11factors:
12        (1) whether there is a sign on the subject property
13    advertising that it is for sale or for lease;
14        (2) whether the subject property is advertised for
15    sale or for lease in a newspaper of general circulation
16    where the property is located;
17        (3) whether the subject property is advertised for
18    sale or for lease on the internet, and whether potential
19    buyers or tenants are reasonably able to access the
20    internet listing;
21        (4) whether the owner of the subject property has
22    contracted for the services of an Illinois licensed real
23    estate professional for the purpose of selling or leasing
24    the subject property;
25        (5) whether any advertised sale price or advertised

 

 

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1    rental price for the subject property is excessive;
2        (6) whether a contract for sale or lease of the
3    subject property is pending;
4        (7) whether the subject property is subsequently sold
5    or leased and the amount of time that passed from the
6    original vacancy until the sale or lease date;
7        (8) whether the owner has applied for and received
8    demolition or construction permits for the subject
9    property;
10        (9) whether the owner has responded to inquiries to
11    lease or sell the property;
12        (10) whether the property has been altered or modified
13    for the purpose of leasing or selling the property;
14        (11) whether the property owner has attempted to
15    lease, sell, or alter or modify the subject property but
16    has not been able to proceed because of the inability to
17    obtain permits or because court proceedings involving
18    prior renters have precluded such action; and
19        (12) any other factors the board deems necessary to
20    determine if the owner of the subject property is actively
21    attempting to lease or sell the subject property or
22    actively attempting to modify or alter the subject
23    property for sale or lease.
24    (b) For purposes of paragraphs (1), (2), and (3) of
25subsection (a), any signs, newspaper advertisements, or
26internet advertisements shall contain valid contact

 

 

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1information for the owner or agent of the property. If the
2contact information does not connect potential tenants or
3buyers to a person who can facilitate the purchase or lease of
4the subject property, or if the owner or agent does not respond
5to the inquiry within 30 days, the signs, newspaper
6advertisements, or internet advertisements may be disregarded
7in the determination of whether a property owner was actively
8attempting to sell or lease the subject property or actively
9attempting to modify or alter the subject property for sale or
10lease.
 
11    Section 25. Penalties.
12    (a) Before assessing any penalties under this Act, the
13board of review shall give notice of the complaint to the chief
14county assessment officer who certified the vacancy relief and
15give the chief county assessment officer an opportunity to be
16heard on the matter.
17    (b) Upon determining that an owner of a subject property
18is not actively attempting to sell or lease the subject
19property, or actively attempting to alter or modify the
20subject property for sale or lease, the board of review may
21direct the chief county assessment officer to do any of the
22following:
23        (1) require from the owner of the subject property the
24    payment of up to 3 times the amount of back taxes owed for
25    any vacancy reduction the subject property received for

 

 

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1    the period in which the subject property received the
2    reduction but was found to have engaged in vacancy fraud
3    as defined in this Act; and
4        (2) require from the owner of the subject property the
5    payment of interest of up to 10% per annum on any back
6    taxes sought under paragraph (1).
7    (c) The unpaid taxes shall be paid to the appropriate
8taxing districts in the manner provided for the payment of
9property taxes under the Property Tax Code and allocated to
10fund the implementation of this Act. Interest and penalties
11shall be paid to the chief county assessment officer's office
12to cover the costs associated with educating the public on the
13provisions of this Act.
14    (d) No penalties shall be assessed until the person to be
15affected has been notified and given an opportunity to be
16heard.
 
17    Section 99. Effective date. This Act takes effect upon
18becoming law.