The majority of Chicago condo association boards do everything they can to avoid special assessments, but sometimes improvement projects or emergency repairs may require it. Here are some key things to know about association assessment adoption in Illinois.
Maintaining Financial Transparency
When establishing special assessment amounts, it’s incumbent upon the board to act as fiduciaries for the association. To that end, board members must enact healthy financial planning strategies to adequately fund the association’s ongoing operating fund as well as its reserve fund.
If the board deems that a special assessment is necessary, per Section 18(a)(8) of the Illinois Condominium Property Act (ICPA), it may adopt a special assessment without unit owner approval provided that it does not exceed 115% of the sum of all regular or special assessments from the preceding year.
Additionally, the special assessment may not be used for an addition or alteration of the common elements or association-owned property. If these items were not included in the adopted annual budget, they are subject to approval by ⅔ of all unit owners.
Rejecting a Special Assessment
The board is required to vote about proposed special assessments at an open meeting. If the proposal does not adhere to the requirements outlined by the state and/or the association’s governing documents, unit owners may take steps to reject the special assessment by taking the following action:
1. Present a petition to the board rejecting the special assessment within 14 days of the board adopting the assessment. The petition must be signed by 20% of the unit owners (or by the unit percentage as stated in the association\’s governing documents).
2. If the requisite 20% of unit owners have properly petitioned the board, the board must call a meeting of the unit owners within 30 days of the date of delivery of the petition.
Importantly, separate assessments related to emergencies or mandated by law may be adopted by the board without being subject to unit owner approval or the procedures for rejecting a special assessment. The ICPA defines “emergency” to mean an immediate danger to the structural integrity of the common elements or to the life, health, safety or property of the unit owners.”
Levying special assessments can cause tension in the condo community. With all board decisions, it’s prudent to maintain transparency with assessment collection and allocation and be sure the board is adhering to all state laws and association governing documents.If you need help with the financial management aspect of running your Chicago condo association, our team at First Community Management can help. Get in touch today to learn more about our full-service program and ask your questions about association management.