New law cuts red tape for real estate professionals, businesses; takes additional bill action
Rauner action streamlines licensing, encourages growth
SPRINGFIELD – (RealEstateRama) — Gov. Bruce Rauner today signed legislation to reduce burdensome licensing requirements for real estate businesses. The new licensing program is expected to save the state money by reducing a duplicative and unnecessary licensure structure that provides no benefit to the public and discourages business creation and growth.
“House Bill 5210 is a win for small business and licensed professionals in Illinois,” Rauner said. “It is another step forward in our goal of reducing the amount of red tape, paperwork, and regulatory burden that puts our business owners and our state at a disadvantage.”
The bill was supported by the Illinois Department of Financial and Professional Regulation (IDFPR).
“On behalf of more than 47,000 realtors throughout Illinois, we support this effort and appreciated the opportunity to work with IDFPR in crafting and passing this legislation,” said CEO of Illinois Realtors Association, Gary Clayton. “This is a sound policy initiative that will streamline the regulatory process for Illinois businesses.”
Additionally, it clarifies that a licensed individual may establish a limited liability company to receive commissions directly, allowing them more flexibility in selecting a business entity that fits their needs. The new practice will also allow the individual to derive more favorable tax treatment than they would receive when operating as an individual.
“The licensing requirements for professionals in Illinois, especially those in the real estate field, are often times too burdensome and redundant,” said State Senator Pamela Althoff, R-McHenry, who co-sponsored the bill. “In an effort to untangle some of the red tape in these processes, this bill no longer requires brokers to obtain a license from each branch of office they operate in, but instead they will only need one license and will simply just need to notify IDFPR of each office.”
Finally, the legislation pushes back continuing education deadlines, establishes one basic standard for all business entities, simplifies the business entity license application, establishes common sense ownership requirements, and reduces barriers to industry.
“These reforms lower the cost of doing business in Illinois,” said co-sponsor Representative Tom Demmer, R-Dixon. “We should look for more opportunities like this for state government to get out of the way of small business owners and grow our tax base.”
The governor also signed House Bill 5502 removing an unnecessary testing requirement to encourage new real estate appraiser trainees to enter the industry. This will reduce a barrier to entry and increase labor market liquidity within the industry.
“The signing of HB 5502 is the first step in rebuilding the appraisal industry here in Illinois,” said Representative Tony McCombie, R-Savanna, who sponsored the legislation. “Due to the increased costs of education and mandates those receiving licenses have continued to decline. I am pleased to have sponsored this bill and the signing of this legislation is a positive change for Illinois. HB 5502 will grow jobs and opportunities for people wanting to enter the real estate appraisal field.”
The changes will reduce the regulatory burden on Illinois real estate related businesses and workers, while improving IDFPR operations.
As of April 2018, there were 1,195 active branch office licenses, according to the IDFPR.
Contact
Elizabeth Tomev
