Compliance with the Chicago Heating Cost Disclosure

gas and electric heatCertain Landlords must provide a heating cost disclosure in Chicago

Tenants responsible for paying for the cost of their gas or electric can often be surprised by the high price of their energy bills.  To combat the impact of those surprises, the City of Chicago passed an ordinance at Chapter 5-16 of the Chicago Municipal Code entitled Disclosure of Heating Costs to Tenants and most Chicago landlords need to comply.

Subject to a few exceptions, the ordinance applies to new (not renewal if the tenant received a previous disclosure) leases where the tenant is responsible for paying for the gas heat or electric heat for the rental unit.

The ordinance provides that before making an oral or written lease or accepting any consideration in a lease application, a landlord or landlord’s agent must disclose in writing: 1) that the cost of heating is the tenant’s responsibility and 2) the projected average monthly cost of utility service of the utility that provides the source of heat to the rental unit for the most recent annual period of continuous occupancy.

If the lease is in writing, the lease must make those disclosures within the written lease and the tenant must execute a receipt acknowledging the disclosure was made.

Landlords or landlords’ agents can obtain the disclosure at no cost by contacting the utility company to request the information.  The utility company must respond to the request for information within two weeks of a request and the disclosure will be considered valid for use by the landlord or agent for six months from the date the disclosure is issued.  A copy of the heating cost disclosure request can be found on the City of Chicago’s website.

Section 5-16-070 provides the penalties for failures of compliance.  If a landlord or landlord’s agent fails to provide or falsifies the required informational disclosure, the landlord or agent shall be subject to a fine not to exceed $500 per offense. The ordinance provides that a landlord or agent will have a defense to the penalty if a request was made of the utility provider and the information was not provided in a timely manner.

So, this is one more requirement that Chicago landlords have to abide by.  One more piece of paper.  One more provision in a lease.  Since the disclosure is valid for six months, property owners interested in renting their real estate would be wise to order the disclosure well in advance so that the information is readily available to their lease applicants and tenants.

About Richard Magnone

Co-founding member of Reda | Ciprian | Magnone, LLC, attorney at law and Illinois licensed lawyer since 1996.
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