April 28, 2017
Home Builders Initiative Passes Illinois House
Bill Ward, Executive Vice President, HBAI
Legislation put forth at the request of HBAI passed unanimously this week in the Illinois House of Representatives. HB3826 prohibits municipalities from collecting transfer taxes on new homes for which impact fees have been assessed and collected. Rep. Mike Fortner (R), a resident and former Mayor of West Chicago, sponsored the bill which passed the House on a 112-0 vote.
The bill now moves to the Senate where Senator Mike Connelly (R-Wheaton) will take on chief sponsorship. Committee action on HB3826 could take place on the week of our HBAI Lobby Day, scheduled for Tuesday, May 9th in Springfield.
HBAI contends that collecting impact fees and transfer taxes for the same purposes is a form of double taxation that is arguably unconstitutional. Impact fees are assessed and collected early in the development process and are used for schools, parks, and other local government needs.
A transfer tax is collected for the same purposes. They are recorded on the HUD application and it can become an issue whether a buyer(s) can afford the down payment, closing costs, and mortgage payments. The buyer pays the full tax at closing, which creates a great barrier to entry for home ownership.
HB3826 is a collaborative effort with involvement from both our state and local associations. The Government Affairs Committee of the Southwest Suburban HBA brought the issue to HBAI last fall for consideration in this year’s General Assembly.
Rep. Fortner accepted sponsorship of the bill after talking with members at a Legislative Dinner held by Northern Ill. HBA. Senator Connelly attended the same event and both found great interest in our issue.
And every local association has pushed for its passage with VoterVoice Letters and phone calls to their own legislators. Thank You all for your support!
The Impact Fee/Transfer Tax bill is now halfway through the General Assembly process. It will be interesting to see if we receive any new push back in the Senate; we had no opposition in the House.
If you come to HBAI Lobby Day, HB3826 will be high on our “To Do” list and we will be asking you to tell your Senator to Vote “Yes” on HB3826!
