Chicago City Council Passes COVID-19 Housing Displacement Ordinances

The Chicago City Council recently passed two ordinances seeking to protect tenants and curb COVID-19 housing displacement. The Fair Notice ordinance establishes new timelines for delivery of notice of non-renewal of residential leases. The “COVID-19 Eviction Protection Ordinance” imposes restrictions on landlords seeking eviction or relief for non-paid rent from tenants impacted by COVID-19. Residential landlords are obligated to comply with these new rules when seeking relief against nonpaying tenants or attempting to deliver notice of non-renewal and should be familiar with their requirements.

The Fair Notice ordinance, passed July 22, 2020, imposes lengthened notice requirements on landlords terminating or electing not to renew residential leases. Previously, most residential landlords were required to serve notice of non-renewal 30 days in advance of the expiration of a lease. Failure to provide such notice resulted in a 60-day notice termination notice requirement.

Now, with the implementation of the Fair Notice ordinance, the Chicago City Council established a sliding scale for notice of non-renewal based on length of tenancy. Tenants with tenancies below six months are entitled to notice of non-renewal 30 days prior to the expiration of the lease. Tenants with tenancies from six months to three years are entitled to 60 days’ notice. Tenants with tenancies of over three years are entitled to 120 days’ notice. Termination notice requirements have also been updated in the event non-renewal notice is not timely delivered, as shown below:

The COVID-19 Eviction Protection Ordinance protects residential tenants economically impacted by COVID-19 from eviction and from landlords seeking relief due to non-payment.

Landlords must provide five days’ notice to tenants when seeking to terminate a lease. Tenants may provide “Notice of COVID-19 Impact” within the five days if they have experienced “any loss, reduction or delay in receipt of income, or loss or reduction of employment attributable in whole or in part to COVID-19.” If a tenant provides such notice, landlords must make a good faith effort to contact and negotiate with the tenant during a seven-day negotiation period following the expiration of the five-day termination notice. Further, landlords may not request personal financial information from tenants during the negotiation period.

Landlords may not file an eviction action or maintain an action seeking rent prior to the expiration of the negotiation period. Landlords must keep documentation of the negotiations, as landlords must prove negotiations were conducted in good faith. Tenants who provide timely Notice of COVID-19 Impact may raise a landlord’s failure to engage in good faith negotiations as an affirmative defense in any subsequent eviction action.

For questions or more information about the Fair Notice Ordinance, COVID-19 Eviction Protection Ordinance, or the Chicago Residential Landlord and Tenant Ordinance, please contact Chad Poznansky (cpoznansky@clarkhill.com, 312-985-5531), Michael Bregman (mbregman@clarkhill.com, 312-360-2125), Andrew Donovan (adonovan@clarkhill.com, 312-517-7513) or another member of Clark Hill's Real Estate Business Unit.