Cook County Housing Ordinance’s Just Housing Amendment: to rent or not to rent? The rules for criminal background checks

Effective Jan. 1, 2020, Cook County passed a revision to its housing ordinance called the Just Housing Amendment (JHO), which governs the use of background checks before the rental of residential units. This procedure has the potential to create liability for landlords (including condominium associations) who rent out units or who have programs that require compliance of renters or owners with certain documentation requirements.

As an overall consideration, the housing ordinance applies to landlords directly, their managers, and staff who are renting an apartment or home to a tenant. This means that leasing agents, brokers or management companies performing the tenant selection for landlords must take note of the new provisions and follow them for all Cook County residential lease transactions as of Jan. 31, 2020, and going forward.

The ordinance as amended is contained in Section 42-38 of the Cook County Code. Cook County ordinances are interpreted further by the Cook County Commission on Human Rights rules, providing additional specificity regarding the amended housing ordinance. The language of the ordinance does not contain certain detail as to timelines but it is found in the rules. The ordinance and the rules should be read together and the rules will remain subject to change by the Commission.

In its most basic summary, the amended housing ordinance prevents landlords from denying a lease to an otherwise qualified tenant if that applicant has a criminal background older than three years. There is an exception for denials for current sex offender registration requirements and current child sex offender registry restrictions, which are allowed regardless of the lookback timeline. It also provides for some exception if the prior criminal history indicates that the tenant is a demonstrable risk to personal safety or property.

Screening tenants is a two-step process

Procedurally, a landlord must now engage in a two-step screening process and make certain disclosures are given to the applicant regarding how their application may be evaluated, such as their rights under the housing ordinance, along with a copy of a portion of the Commission on Human Rights rules (Section 700) or a link to them. The landlord completes prospective tenant screening on its usual evaluation criteria except for the criminal background. After completing the first screen that determines a prequalified candidate, the landlord may then complete the criminal background check. Landlords must also provide the criminal background check results to the candidate within five days after receiving it.

Prospective tenants then must be given the opportunity to dispute the information obtained in the criminal background check. Prospective tenants may also provide evidence to demonstrate inaccuracies in their conviction history or evidence of other factors that may mitigate their criminal background check. Landlords considering criminal conviction information must perform an individualized assessment of the facts and results before denying the prospective tenant, which takes into account a variety of factors.

Many landlords rely on one-stop search providers to check a prospective tenant’s credit, background and court records, including criminal history. Landlords should implement the new procedures required by the ordinance and ensure that the criminal history is not obtained during the first qualification search.

Penalty for noncompliance?

Penalties, though not clearly defined in detail in the Chicago Residential Landlord and Tenant Ordinance, may be severe and similar to other violations of the Cook County Housing Ordinance before the Human Rights Commission. Given this, landlord-owners should anticipate that tenants may seek private rights of action (individual lawsuits) after seeking relief from the Commission.

For background checks and prohibitions regarding tenants with criminal history, it is still acceptable and not contrary to the ordinance to have a criminal background check extending beyond three years. As worded in the ordinance and interpreted in the rules, the landlord cannot consider convictions that are more than three years old. The ordinance does not suggest that background checks beyond the three-year lookback are prohibited. This just means consideration of items older than three years are improper grounds to deny an application, unless exceptions apply.

Generally, landlords and their agents should put their tenant selection criteria in writing, separate out criminal background checks from the first step of their tenant search process, and be careful to follow the two-step process discussed in the ordinance, including disclosure of criminal search results to prospective tenants. This may change the rental application timeline for some properties but compliance for Cook County properties is mandatory.

As with any law, the ordinance remains subject to change and further interpretation in the rules in the future.

For more information about this new ordinance or to perform an audit of existing leasing procedures, contact a Chuhak & Tecson Real Estate law attorney.

This Chuhak & Tecson, P.C. communication is intended only to provide information regarding developments in the law and information of general interest. It is not intended to constitute advice regarding legal problems and should not be relied upon as such.

Client alert authored by James R. Stevens, Principal.