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HomeMy WebLinkAboutOrd 2961 11/20/197911/21/79 ORDINANCE NO. 2961 AN ORDINANCE REGULATING THE SALE OF CONDOMINIUMS 4HEREAS, there are a subStantial number of buildings being con- ;tructed as condominiums and a large number of rental multiple ~amily dwellings which are available to convert to condominium inits in the Village of Mount Prospect; and ~EREAS, there have been and continues to be in and around the riCinity of the Village of Mount Prospect large numbers of rental twellings converted to condominium units; and ~EREAS, the :President and Board of Trustees of the Village of fount Prospect find that it is in the best interest of the resi- ents of residential multiple-family structures in the Village to )rovide for notice to them of the conversion~of their buildings il rder to allow such residents time within which to find alterna- i~e hOusing or to purchase a condominium unit; and ~EREAs, the president and Board of Trustees find that it would b the best interest of existing and prospective residents of the Tillage to require specified information to be disclosed by the teveloper of a condominium project to prospective purchasers of ondominium units. OW, THEREFORE, BE IT ORDAINED BY THE PRESIDENT AND BOARD OF TRUSTEES OF THE VILLAGE OF MOUNT PROSPECT, COoK COUT~TY, ILLINOIS ~S FOLLOWS: ~ECTION ONE: Chapter 24 of the Municipal Code of the Village of ~unt Prospect be, and the same is hereby, amended by adding ;hereto a new Article XIII, which said new Article shall hereafte )e and read as follows: ARTICLE XIII. REGULATIONS ON THE SALE OF CONDOMINIUMS. SECTION 24.1301. Purpose. There are a substantial number o buildings being buitt as condominiums in the Village of Moun Prospect and a large number of rental units within existing multiple-family dwellings which are available for conversion to condominiums. The President and Board of Trustees of the Village of Mount Prospect therefore find that it is in the best interest of the present and prospective residents of the Village to establish regulations to require disclosure of specified information to prospective purchases of condomini~ units and to provide for adequate notice and protection of the rights of tenants in buildings being converted to condo- miniums. SECTION 24.1302. Application It should be unlawful for any person, firm, or corporation to offer a condominium unit for sale within the corporate limits of the Village of Mount Prospect without complying with the provisions of this Article XIII. B. The proVisions of this ~rticle shall apply to any I Property improved with any 'building of more than four (1) dwelling units 'Which was constructed as or is being con~ verted to a Condominium. I 11/21/79 Notwithstanding any provision to the contrary set forth hereinafter, no developer shall be required to furnish o distribute the Preliminary and Final Property Reports required by this Article until forty-five days after the effective date of this Article, and provided, however, that if the sale of any unit in a condominium project is scheduled to close and does close within forty-five days after the effective date of this Article, the developer shall not be required to provide a Preliminary or Final Property Report to the prospective purchaser of any such unit. SECTION 24.1303. Definitions. As used in this Article, 1. "Act" means the "Condominium Property Act," as amended from time to time, of the State of Illinois. e "Declaration" or "Condominium Declaration" means the instrument by which Property is submitted to the provi- sions of the Act, and such Declaration as from time to time amended. 3. "Parcel" means the lots of land, described in the Decla-' ration, submitted to the provisions of the Act. o "Property" means all the land, property and space com- prising the Parcel, all improvements and structures erected, constructed or contained therein or thereon~ including any buildings and all easements, rights and appurtenances belonging thereto, and ~11 fixtures and equipment intended for the mutual use, benefit or enjoy- ment of the Unit Owners, submitted to the provisions of the Act. 5. "Unit" or "Condominium Unit" means a par~ of the Property designed and intended for independent use. "Convert" or "Conversion" means submitting Property pre- viously occupied for rental or other purposes and owned not as a condominium to the provisions of the Act. o "Common Elements" means all portions of the Property except the Units, including Limited Common Elements unless otherwise specified. e "Person" means a natural individual, corporation, part- nership, trustee or other legal entity capable of holdin title to real property and any firm. o "Unit Owner" means the person or persons whose estates o interests, individually or collectively~ aggregate fee simple absolute ownership of a Unit. "Unit Owners~ shal include any beneficiary of a trust, shareholder of a corporation, partner of a partnership, whether limited or general, or participant in any venture holding legal title to a Unit and trustees. - 3 - 11/21/79 10. 11. 12. 13. 15. 16. 17. 18. 19. 20. 21. "Blanket Encumbrance" means a trust deed, mortgage, judg ment, or other lien or encumbrance including an option o contract to sell or a trust agreement affecting the Property including any lien or other encumbrance arisin¢ as a result of the imposition of any tax assessment by public authority. "Condominium Project" means the Property in which Con- dominium units are offered for sale. "Plat" means a Plat or Plats of survey of the Parcel of all Units in the Property submitted to the provisions of the Act, which may consist of a three-dimensional horizontal and vertical delineation of all such Units. "Common Expenses" means the proposed or actual expenses affecting the Property, including Reserves, if any, fully assessed by the Board of Managers of the Unit Owners' Association. "Operating Expenses" means that portion of common expenses used for current expenses of operating the Property. "Reserves" means those sums paid by Unit Owners which separately maintained by the Board of Managers for pur- poses specified by the Board of Managers, the or By-Laws for the Property and which are not budgeted for operating expenses. "Association" means the Association of all the Unit Owners, acting pursuant to the By-Laws through its duly elected Board of Managers. "Purchaser" means any person or persons other than the Developer who purchase a Unit in a bonafide transaction for value. "Propsective Purchaser" means any person who visits the Property for the purpose of inspecting such Property possible purchase of a Condominium Unit or who requests a Property Report. "Developer" means all persons who are legal or equitable owners of a Parcel of Property which is submitted to the provisions of the Act and any and all successors of persons~ interests in the Property except a Purchaser oi an individual Unit. "Agent" means any person who represents or acts for or behalf of a developer in the Offering for Sale or sale Condominium Units. "Limited Common Elements" means a portion of the Common Elements so designated in the Declaration as being reserved for the use of a certain Unit or Units to the exclusion of other Units. 22. 23. 24. ' 4 - 11/21/79 "Offer for Sale" means any inducement, solicitation, advertisement, publication or announcement concerning the availability of condominium units for purchase. "Board of Managers" or "Board" means those owners electe to administer the Property at the time and in the manner provided by the Declaration for the Property and vested with the rights, titles, powers, privileges, trusts, duties and obligations imposed by the Act, Declaration and By-Laws and, until such persons are or must be elected, shall mean the Developer as herein defined. "By-Laws" means those certain by-laws governing the administration of the Property and such amendments as ma be made from time to time. SECTION 24.1304. Preliminary Property 'Report. It shall be unlawful for any developer or its agent to offer for sale an condominium unit in a building containing more than four dwe%ling units without first having prepared and having available for inspection by prospective purchasers and dis- tribution to prospective purchasers who request a copy, a preliminary property report containing the following informs tion with regard to the property being converted: 1. Name and address of and number of units in the condo- miniUm project; 2. Namer address and telephone number of the developer of the condominium project; 3. The sales price of each unit in the condominium project; 4. An estimate of the real estate taxes for each unit base~ upon the sales price established for each such unit and computed at the rate of the previous year's real estate taxes as equalized for single-family dwellings; 5. A statement of the estimated common expenses for the condominium project for the year following the date of closing the first sale of a condominium unit in the condominium project with each item of expense separatei5 listed. Such list shall include b6t not be limited to any of the following items included as common expenses: a. All utilities including, fuel for heat and hot wate] electricity and water and sewer; b. Scavenger service; c. Janitorial, landscaping and other maintenance Servic~ d. Supplies; e. Security services; f. Maintenance and operation of recreational facilitie: g. Insurance; Se e 10. - 5 - 11/21/79 h. Elevator maintenance; i. Repairs; Sidewalk and street maintenance, including snow removal; Management Services such as management agents, lawyers, accountants and bookkeepers and the like; Reserves. If no provision for reserves is included in the estimated common expenses, the following statement in type size and style equal to at least 10 point bold type shall be set forth: NO RESERVE FOR POSSIBLE FUTURE COSTS IS INCLUDED IN THE ESTIMATED C0~MON EXPENSES. IT MAY, THEREFORE, Bi NECESSARY FOR UNIT OWNERS TO PAY A SPECIAL ASSESSMEN~ TO PAY FOR SUCH COSTS IF THEY OCCUR. An estimate of the monthly assessment for each unit with each item included within such monthly assessment separately itemized; If the purchase of all or any of the condominiun units it to be financed by the developer or if financing has been arranged by the developer, a statement indicating: The name, address and telephone number of the person providing such financing; The interest rate to be charged; The downpayment which will be required; The length of the mortgages being offered; The service charge (points) which will be charged; Any other fees which will be charged for considering an application for a mortgage or providing financing including, but not limited to, application fees and appraisal charges; The estimated monthly payment for each condominium unit for mortgage and interest payments and real estate taxes with the mortgage and interest payment estimated on the basis of prevailing mortgage rates at the prevailing length of mortgages being offered by financial institu- tions for similar Property in the area; A statement indicating what, if any, amounts a purchaser will be required to pay as an initial condominium assess- ment and/or for reserves. A description of the personal property included within tl sales prices established for the condominium unit, which description shall include the brand name, approximate ag( and condition of each such item of personal property; - 6 - 11/21/79 11. 12. 13. 14.' 15. 16. 17. 18. 19. 20. A statement indicating what, if any, assessments, fees o charges may be separately charged to a unit owner in add~ tion to the monthly assessment for maintenance of the co] dominium project or for amenities provided in connection therewith including, but not limited to, pools, golf courses and tennis courts; A statement setting forth the method and timing of trans. fer of control of the condominium project to the Board o~ Managers from the Developer and the rights retained by the Developer thereafter, if any~ A preliminary draft of the Condominium Declaration; A description of provisions made by the developer for pets, if any; A description of any and all contracts including, but no limited to, management contracts, insurance policies, contracts for the provision of laundry facilities and other contracts for services, which relate in any way to the premises of the condominium project, which descripti shall include the names and addresses of the parties to such contract, the date such contract expires, the for such contract, the cost or payment for such contra. or the services provided pursuant to it~ and provisions for renewal of such contract. Any such contracts shall be made available for inspection by prospective pur- chasers on the premises of the condominium project. developer shall also include a statement indicating interests, if any, the developer or any other cor~ partnership or firm which developer has an interest~ ha~ in such contracts and the nature and extent of such interest. A statement indicating whether there are any restrictior on the purchase or sale of condominium units including statement whether condominium units may be purchased by! -investors for rental purposes or by businesses for use persons it authorizes; A statement indicating the use permitted for units by applicable zoning regulations of the Village Mount Prospect and the Declaration and By-Laws for the condominium project; A statement indicating what, if any, warranties apply t¢ the condominium unit, common elements and personal property of the condominium project; A copy of the real estate sales contract for the purcha~ of a condominium unit; If the condominium project is under construction, the projected date for completion of the condominium projec and a statement setting forth the consequences to a pur, chaser and the remedies available to the purchaser against the developer if the condominium project is completed by the projected date; 21. ' ~:' 11/21/79 If a building is being converted to condominiums, the fo lowing additional information must be included in the Pr liminary Property Report: a. An itemized list of the operating expenses for the building being converted for two years prior to the date the first unit is offered for sale, provided, however, that if the building was unoccupied at any time during that two year period, an itemized list o the operating expenses for the building for the most[ recent two year period during which such building wa~ occupied; A report certified by a registered architect or engineer indicating the age and condition of the plumbing, heating, air conditioning, water pipes and water heating systems'of the.c6nd~minium.project as well as elevators, TV antennas and any other common elements of the condominium project. This report shall also specify all type~ of fuel which are used,! state the purposes for its use and indicate the name and address of the supplier of such fuel. A statement indicating what, if any, improvements repairs the developer intends to make in the ~ of the condominium project, the projected date of completion of each such improvement or repair and a statement setting forth the consequences to a pur- chaser and the remedies of a purchaser against the developer if the developer fails to complete such repairs or improvements altogether or by the dates specified. 22. The following statement in a type size and style equal at least 10 point bold type: THE INFORMATION CONTAINED IN THIS PRELIMINARY PROPERTY REPORT IS PROVIDED TO YOU PURSUANT TO THE PROVISION OF ARTICLE XIII OF THE MUNICIPAL CODE OF THE VILLAGE OF MOUNT PROSPECT. SAID ARTICLE XIII OF THE MUNICIPAL OF THE VILLAGE OF MOUNT PROSPECT ALSO REQUIRES THAT A FINAL PROPERTY REPORT WITH RESPECT TO THIS CONDOMINIUM PROJECT BE PROVIDED TO YOU NO LATER THAN PORTY-FIVE (45~ DAYS PRIOR TO THE DATE OF CLOSING YOUR PURCHASE OF A CONDOMINIUM UNIT. SECTION 2'4.130'5. Final' Property Report. No later than fort ~ive .(45) days prior to the date of closing the sale of a condominium unitt the developer shall provide a prospective chaser with a Final Property Report containing the followin¢ information: 1. The Condominium Declaration; 2. A Plat for the condominium project; The articles of incorporation or charter of the Associa tion, if any, and the By-Laws and any other regulations of the Association; - 8 - il/21/79 e Se o e 10. 11. A statement indicating the share of ownership of the co~ mon elements for each condominium unit; A description of any property or faci!itie~ located on the site where the condominium project is located but which is not a part of the Property, and a statement indicating the nature of such property or facility, its location and the ownership thereof; A description of any recreational facilities which are a part of the condominium project and the projected comple tion date for each such recreational facility not com- pleted; A site plan, drawn to scale, for the premises of the condominium project showing at least the following: a. The location of any and all buildings with an indica tion of the type of use of each such building; The location of any and all recreational facilities and an indication of the type of recreational facility; Ce The location of sidewalks, walkways and streets both on the premises of the condominium project and bOrdering it; d. The location of parking areas and garages; A statement indicating the names and addresses of the following: Se bo Any person with a blanket encumbrance on the condo- minium project; Any other lenders who have loaned funds to finance all or any portion of the condominium project;. A statement indicating the nature and extent of any protection of a prospective purchaser if the developer defaults on a blanket encumbrance~ A statement of any litigation which would affect the condominium project or the developer's ability to convey clear title; A statement with regard to the condition of the title to the premises of the condominium project including, but not limited to, the following: a. The ownership of the premises of the condominium project; b. Restrictions on the use or transfer of the pre- mises of the condominium project and any other restrictions, if any; f/21/79 12. 13. - 9 - 14. 15. 16. 17. 18. 19. 20. 21. ¸22. A title report; The documents to be used in the sale and purchase of condominium units, including, but not limited to, the following: a. Deed or Deeds of conveyance; b. Bill of sale; c. Deed of trust, if applicable; d. MOrtgage and promissory note if financing is through the developer of such documents are other- wise available to the developer; The names and addresses of the attorney, architect, engineer and contractor for the condominium project; A map Showing the existing zoning Of parcels of pro- perty contiguous to the PropertY Condominium project; A list of all state, county and municipal agencies Providing health and building code inspections, law enforcement, traffic patrols, fire protection and ambulance service, road repair, snow removal and similar services either for the condominium project or on the streets adjacent to the Property; Location and type of schools which serve the area in which the condomin.ium project is located; A brief statement indicating parking restrictions, if a which apply to streets which are on the premises of the condominium p~oject and on streets which border the con- dominium project and scavenger and water and sewer serv~ ~e whiCh will be provided to the condominium project; A statement setting for the costs, if any, incurred in each year three years prior to the date of conversion of the condominiun pr~ect for snow removal, pr~ected snow removal costs for each year two years after the date of conversion or construction of a condominiun pr~ect and a plan showing areas of the condominium pr~ect from wbich snow is proposed to be removed; A statement setting forth the provisions of the Act which require a purchaser's deposit on a condominium unit to be placed in an interest bearing escrow account Copies of any leases of real or personal property to the condominium project of more than one applicable year duration; ' If it is prOposed that the cOndominium prOject is to be] managed by a management, agent, a statement containing the following information: 23. 24. 25. 26. - 10 - ~11./21/79 a. The name and address of the management company to be used; A contract, if any, for the management services to provided; Unless otherwise set forth in the contract for manac ment services, a statement indicating: (1) the management services to be provided; (2) the term for such management services; (3) the charges for such management services and th, conditions, if any, under which they may be increased; (4) the conditions under which the agreement for management services may be terminated; (5) the relationship, if any, between the developer and management company; A statement indicating what, if any, impact there would be on estimated monthly assessments for common expenses if all of the condominium units were not sold; A report by a licensed architect or engineer who is not an employee of the developer setting forth such archi- tect's or engineer's opinion with respect to the condi- tion, useful life and a§e of the roof, foundation, external and supporting walls, structural elements and mechanical, electrical and plumbing systems of any building which is a part of the condominium project; A statement indicating whether the Village of Mount Prospect has notified the developer of any building violations of the condominium project and if so, a list of such building code violations and the date when such building code violations were or will be corrected. The following statement shall appear in a type size and style equal to at least 10 point bold type: ARTICT~ XIII OF THE MUNICIPAL CODE OF THE VILLAGE OF MOUNT PROSPECT PROHIBITS ANY PERSON FROM REPRESENTING THAT THE VILLAGE OF MOUNT PROSPECT ~AS CONSIDERED THE MERITS OF OR APPROVED THE CONVERSION OF THE PROPERTY TO CONDOMINIUMS. THE STATEMENTS, DOCUmeNTS, REPRESENTATIONS AND ANY OTHE] PROVISION CONTAINED IN THE PRELIMINARY AND FINAL REPORTS MUST BE SWORN TO BE TRUE AND CORRECT BY THE DEVELOPER. ' ~21/79 - I1- SECTION 24.1306. Execution of Property Reports. The Prel nary and Final Property Reports required by this Article sha~ be signed and attested and sworn to be true and correct by each developer of the condominium project. SECTION 24.13'07. Transfer of COnt'rol. The developer shall ~ransfer control of the Association to the owners elected to the Board of Managers as provided in the Condominium Declara tion or as provided in the Act, whichever occurs earlier. SECTION 24.13D8. Payment for Common Expenses Exceeding Estimate. The 'developer shall pay any and all amounts by which the first year's common expenses for the condominium project, excluding amounts-for reserves, exceed by twenty percent (20%) the estimated common expenses set forth in the Preliminary Property Report for the condominium project for those items included within said estimate; provided, however developer shall not be required to pay such amounts if the increased common expenses are due to increases in the cost o fuel, useage of fuel or services which exceed the amount which said estimate was based, inflation and any unforseen circumstances including, but not limited to, unusually cold weather and h~avy snows which increase, respectively, common expenses for fuel and snow removal. SECTION 24'.1309. Notice of Intent to Convert. The develo shall serve written notice of intent to submit the Property to the provisions of the Act, by personal service or by registered or certified mail, return receipt requested, to ~ny and all tenants of the Property at least 120 days but no mone than one year prior to such submission. Such notice shall accompanied by a Copy of the Preliminary Property Report the condominium property. SECTION ~4.1310.' A. Rights of Tenants. Any tenant who was a tenant as of the dare'of the of intent and whose tenancy expires, other than for cause, prior to the expiration of 120 days from the on which a coPy of the notice of intent was given to tenant shall have the right to extend his tenancy on same rental until the expiration of suCh 120 day period by the giving of written notice thereof to 'the develo within 30 days of the date upon which a copy of the notice of intent was. given to the tenant by the develo B. Each lessee in a Conversion condominium shall be by the developer at the time the notice of intent is given whether his tenancy will be renewed or terminated upon its expiration. I~f the tenancy is to be renewed, the tenant shall be informed of all charges, rental or otherwise, in connection with the new tenancy and the 'length of the term of occupancy proposed in conjunction therewith. C. For a period of 120 daYs following his receipt of the notice of intent, any tenant who was a tenant on the da' the notice of intent was given shall be given the right - 12 - 11/21/79 to purchase his unit on better or substantially the same terms and conditions as set forth in any duly executed contract to purchase the unit, which contract shall con- spicuously disclose the existence of, and shall be sub- ject to, the right of first refusal. The developer shall notify the tenant within five (5) days after exe- cution by the developer of any contract to purchase the unit during the 120 day period. The tenant may exercise the right of first refusal by giving notice thereof to the developer prior to the expiration of 30 days from the giving of notice by the developer to the tenant of the execution of the contract to purchase the unit. Prior to their initial sale, units offered for sale in a conversion condominium and occupied by a tenant at the time of the offer shall be shown to prospective purchase] only a reasonable number of times and at appropriate hours. Units may be shown to prospective purchasers onl' during the last 90 days of any expiring tenancy. Any tenant may, at its option, cancel and terminate its lease by serving written notice on the developer by personal delivery or by registered or certified mail, return receipt requested, within 60 days after the date tenant receives the notice of intent to convert. The notice of cancellation and termination of a lease shall specify the da~e when such lease shall be considered terminated and cancelled by tenant, which date shall be no earlier than the date tenant vacates the premises. If a tenant exercises its option to terminate its lease hereinabove provided, tenant shall be entitled to the return of any security deposit held by the lessor minus any amounts lessor is entitled to withhold under the pre visions of the lease for damage to the premises and the like and clean-up costs and charges. SECTION 24.1311. Filing of Property Report. One copy of ~reliminary and Final P~operty Reports shall be filed with the DirectOr of Community Development at the times specified respectively in Section 24.1304 and Section 24.1305. SECTION 24.1312. Inspections and Fees. ao A condomini~m project, including each condominium unit, shall be inspected by the Village .of Mount Prospect for compliance with applicable Village ordinances. The developer shall arrange a date and time for such inspection with the Director of Corm, unity Development at the time the Preliminary Property Reoort is filed. Such inspection shall be scheduled for ~o later than ninety (90) days prior to the submission of the Property to the Act. The fees for inspection of the condominium project and for other services of the Village in connection with the condominium project shall be as follows: 11/21/79 A nonrefundable fee of $100.00 for each ten condo- minium units or less which are a part of the condo- minium project to be paid to the Village on the date the Preliminary Property Report is filed with the Director of Community Development. A ten dollar ($10.00) fee for the inspection of each condominium unit payable at the time of scheduling each such inspection. SECTION 24.1313. Resale of Condominium unit by Unit Owner. In the event of any resale of a condominium unit by a unit owner other than the developer such owner shall obtain from the Board of Managers and shall make available for inspectior to the prospective purchaser, upon demand, the following: 1. A copy of the Declaration and By-laws, and any other Rule and Regulations. 2. A statement of any liens. A statement of any capital expenditures anticipated by t~ unit owner's association within the current or succeedin¢ two fiscal years. A statement of the status and amount of any reserve for replacement fund and any portion of such fund earmarked for any specified project by the Board of Managers. A copy of the statement of financial condition of the un owner's association for the last fiscal year for which such statement is available. 6. A statement of the status of any pending suits or judg- ments in which the unit owner's association is a party. 7. A statement setting forth what insurance coverage is pro- vided for all unit owners by the unit owner's association A statement that any improvements or alterations made to the unit, or the limited common elements assigned theretc by the prior unit owner are in good faith believed to be in compliance with the condominium instruments. SECTION 24.1314. Provisio~ of Required Information to Unit Owner. The Board of Managers of the condominium project shal provide a unit owner with the information required to comply with the provisions of Section 24.1313 within 30 days after receipt of a written request to do so. SECTION 24.1315. Penalties for Violation. Ao The following penalties shall apply to any person con- victed of a violation of this Article: A fine of not less than Three Hundred Dollars ($300.00) nor more than Five Hundred Dollars ($500.00) for a first offense; e ~-,21/79 - 14 - e A fine of not less than Five Hundred Dollars ($500.00) and not more than Seven Hundred Dollars ($700.00) for the second and each subsequent offense within a 180 day period following the first offense Any offense in excess of three committed within a 180 day period may also be punishable by incarcerat~ for a term not to exceed six months under the provi- sions of Section 1-2-1.1 of the illinois Municipal Code, Ill. Rev. Stat., 1977, ch. 24 §1-2-1.1. For purposes of this Article, each day a violation of this Article exists shall be Considered a separate offen In addition to the penalities set out above, the duly authorized offices of the Village may enforce the terms of this Article XIII in such actions at law or in equity as may seem necessary or desirable. SECTION TWO: This Ordinance shall be in full force and effect fl and after i'ts passage, approval and publication in the manner pr( vided by law. Passed this 20th day of November , 1979. AYES: ~ar,ley, Floro~, Miller, Murauskis, Richardson, Krause NAYS: Wattenberg ABSENT:None' Approved this 20th day of November , 1979. Approved: Attest: village President ' i Village Clef