Alderman Moreno is back with a piecemeal version of his prior CRLTO amendments

Ordinance unfairly targeting landlords about to be introduced

If you read this blog, you are certainly aware of the “Good Cause for Eviction” ordinance championed by first ward Alderman Proco Joe Moreno in May earlier this year.  Landlords came out in force and Alderman Moreno’s office decided not to introduce the ordinance and instead was going to put together a task force to look at the issues he was proposing.  Now, not more than three months later, it looks like he is ready to propose an amendment to the CRLTO that was contained in the Good Cause for Eviction ordinance.

Here is what we believe to be the text of the ordinance:

ORDINANCE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CHICAGO.

SECTION 1. The Municipal Code of Chicago is amended by adding to chapter 5-12 a new section, section 5-12-115, entitled Notices for rental rate increases, as follows:

5-12-115 Notices for rental rate increases.

A landlord shall not, over a rolling 12 month period, increase a tenant’s rent unless the landlord provides the renter with:

1. a) 30 days’ written notice prior to the effective date of the change for any increase by less than five percent;
2. b) 60 days’ written notice prior to the effective date of the change for any increase by five percent but less than ten percent;
3. c) 90 days’ written notice prior to the effective date of the change for any increase by ten percent but less than fifteen percent; or
4. d) 120 days’ written notice prior to the effective date of the change for any increase by fifteen percent or greater.

If the landlord fails to give the required written notice, the tenant may remain in the dwelling unit for up to the amount of time specified in this section according to the percentage increase in rent after the date on which the written notice is given to the tenant, regardless of the termination date specified in the existing renal agreement. During such occupancy, the terms and conditions of the tenancy (including, without limitation, the rental rate) shall be the same as the terms and conditions during the month of tenancy immediately preceding the notice; provided, however, that if the rent was waived or abated in the preceding month or months as part of the original rental agreement, the rental amount during such amount of time shall be at the rate established on the last date that a full rent payment was made.

SECTION 2. This ordinance shall be in full force and effect from and after its passage and publication.

So let’s take a look at this proposal.  Before that, let me remind everyone of one particular part of the ordinance – a section under the comically titled section known as “Landlord Remedies” at 5-12-130 (I defy you to find many remedies in that section which is packed full of tenant-favorable requirements on lenders, but I digress…).  That section, at 5-12-130(i) says:

5-12-130(i)Notice of Renewal of Rental Agreement. No tenant shall be required to renew a rental agreement more than ninety (90) days prior to the termination date of the rental agreement. If the landlord violates this subsection, the tenant shall recover one month’s rent or actual damages, whichever is greater.

So, let’s refresh that a landlord is currently PROHIBITED by the ordinance from requiring a tenant to renew a rental agreement more prior to the end of a lease term.  Now, on to the proposed ordinance.

The proposed ordinance indicates that a landlord cannot “over a rolling 12 month period” increase a tenant’s rent without providing the tenant a notice of the rental increase.  The advance time for the notice is a sliding scale depending on how much the increase will be.

  increase         notice
<5%            30 days
5-9.99%      60 days
10-14.99%  90 days
15%+         120 days

So, a landlord increasing the rent by 15% will have to give a 120 day notice.  However, let’s remember that a landlord can’t contact a tenant about a renewal until 90 days prior to the expiration of the lease.  So we have found at least one inconsistency in the law – a landlord complying with this section would be violating another section of the ordinance.

If a landlord does NOT serve the notice within the time required, then the tenant can stay in the property for the amount of time specified in the ordinance (ie. for a 7% increase, that would be 60 days) REGARDLESS OF THE TERMINATION DATE OF THE LEASE on the same terms as prior to the increase (this is similar to the language found in another ridiculous provision of the ordinance 5-12-130(j) which requires 30 days notice of non-renewal prior to the expiration of a lease.  Ahem, don’t tenant’s know that the lease ends on the lease end date?  Do they need to be served another eviction notice?  Only in the City of Chicago!).

I wonder if Alderman Moreno has decided to attempt to pass his original Good Cause for Eviction ordinance a piece at a time?  It is also a bit disappointing that this amendment comes out without any meaningful public dialogue with landlords (that I am aware of).  It is my understanding that MANY landlords showed up at Alderman Moreno’s office a few months back and his office supposedly indicated that they would work with landlords on these issues.  Honestly, this ordinance feels like quasi-rent control to me.  If the City raises taxes by 20% (have you seen some of the assessments coming out?) and the landlord wants to pass those costs along to a tenant, the landlord better hope he or she has the time to do it.  Once again, this is a case of over-legislation.  This is an unnecessary provision and just makes the life of the Chicago landlord harder.  Give Alderman Moreno or your own Alderman if you live or own in a different ward a call and oppose this amendment!