CITY HALL — After a wait of almost a year, a measure to keep renting tenants in foreclosed properties was approved by a City Council committee and is headed for consideration by the full council next week.
First proposed by Ald. Richard Mell (33rd) last summer, the Keep Chicago Renting Ordinance was approved with minor changes Thursday by the Committee on Housing and Real Estate. It would protect renters in foreclosed properties and allow for them to remain in their home at least until the mortgage-holding bank sells it to a third party.
It would call for mortgage holders to pay renters $10,600 to move, down from $12,000 in an earlier version of the ordinance.
It won approval despite opposition from Brian Bernardoni, senior director of government affairs and public policy with the Chicago Association of Realtors, and Pat Holden, senior vice president of government relations for Bank of America.
Bernardoni maintained it would hurt property values, but Ald. Ameya Pawar (47th) argued that it was actually designed to "stabilize communities."
Holden said the General Assembly was already considering a bill that would extend the federal Protecting Tenants at Foreclosure Act, which is set to expire next year. Yet Mell and Ald. Walter Burnett Jr., who has been outspoken on the issue, pressed for more regulations than a law that wasn't working to keep foreclosed properties from going vacant and becoming a neighborhood blight.
"We'd like to see the banks take a more active role in it," Mell said, asking them to be "partners" to solve a problem he said they created with rampant foreclosures over the last five years.
Holden said banks typically "do not know who is the tenant" when they foreclose on a property and that they fear a "cottage industry" of squatters who might move into vacant properties and claim the moving fee.
Mark Swartz, of the Lawyers Committee for Better Housing, responded that the ordinance would not protect squatters.
"It only protects bona fide tenants," he said.
Pawar emphasized that banks don't have to pay the moving fee unless they forcibly remove tenants and leave the property vacant.
"Banks simply don't care," said Diane Limas, of the Keep Chicago Renting Coalition and the Albany Park Neighborhood Council. "Banks don't want to do this because it will potentially affect their profits."
Limas said her group was satisfied with the final compromises, including the reduced moving fee.
"Of course, we would have liked it higher, because we think it's a drop in the bucket for the banks," she said. "But we're OK with it."
Although supported at one point by 44 aldermen, the proposed ordinance stalled in committee. It appeared ready for passage earlier this month, but again was held by Ald. Ray Suarez (31st), chairman of the Housing Committee.
"We're hoping everything goes as planned on Wednesday," Limas said, when the full council is expected to vote on it. "That'll be huge for us."