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Chicago

The city of Chicago passed the Affordable Housing Preservation Ordinance (CHICAGO, ILL., MUN. CODE § 2-44-111) in 2007 to supplement the Illinois Federally Assisted Housing Preservation Act. The local ordinance requires owners of federally-assisted housing to notify the city department of housing in addition to the notifications that must be sent under the state law upon prepayment, termination or an intended disposition of the property. Furthermore, where a tenant association has not exercised its purchase rights under the state law, owners must still give qualified entities the right of first refusal prior to sale of the property to a non-qualified entity, unless an affordability preservation agreement has been entered into extending for a period of at least ten years. The right of first refusal operates such that an owner may enter into a contingent sales agreement with a non-qualified entity that must then be submitted to the city housing commissioner. The commissioner is then required to make the agreement immediately available to all qualified entities, which then have 120 days to make a bona fide offer of purchase on terms that are “economically substantially identical” to the terms in the contingent sales agreement. If the qualified entity agrees to close on the sale within 120 days then the owner must sell to the qualified entity and enter into an affordability preservation agreement. If no qualified entities make such a bona fide offer, or if one fails to close within 120 days, then the owner may sell to the non-qualified entity identified in the contingent sales agreement under terms that do not substantially deviate from the original agreement. Any aggrieved person, including tenants, may enforce these provisions.

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