The 115% Rule: When Illinois Owners Can Petition to Reject Your Budget
The 115% rule is one of the most misunderstood budget provisions affecting Illinois condominium and common interest community associations. It is often described as a limit on assessment increases or as a requirement that owners approve any budget increase above 15%.
Neither description is accurate.
The 115% rule does not prohibit a board from adopting a budget that increases assessments by more than 15%. Instead, it gives owners a limited right to petition for a membership meeting after the board adopts a qualifying budget or separate assessment.
Even after a valid petition, the budget remains in effect unless owners holding a majority of the total association vote affirmatively reject it.
For Illinois association boards, misunderstanding the 115% rule can lead to incorrect deadlines, defective meeting procedures, unnecessary owner conflict, and the mistaken belief that a petition automatically overturns the board’s decision.
What Triggers the 115% Rule?
The statutory calculation compares the sum of all regular and separate assessments payable during the current fiscal year with the sum of all regular and separate assessments payable during the preceding fiscal year.
The 115% rule applies when the new total exceeds 115% of the prior-year total.
The word “exceeds” matters. A new assessment total that equals exactly 115% of the prior-year amount does not appear to trigger the petition procedure.
Consider an association whose owners were required to pay $600,000 in regular and separate assessments during the previous fiscal year.
The calculation would be:
$600,000 × 115% = $690,000
A new total of exactly $690,000 would equal 115% of the previous year. A total above $690,000 would cross the statutory threshold and could activate the 115% rule.
Boards should perform this calculation using assessments payable, not merely the percentage increase in monthly dues or the difference between two operating budgets. Separate assessments payable during either fiscal year can affect the comparison.
The 115% Rule Is Not a 15% Budget Cap
Illinois boards generally retain authority to adopt annual budgets and assessments in accordance with the applicable statute and the association’s declaration and bylaws.
The 115% rule creates an owner-petition procedure. It does not establish an automatic ceiling on assessment increases. It also does not require the board to obtain owner approval before adopting a qualifying budget.
This distinction becomes important when insurance premiums, utilities, payroll, reserve contributions, contracted services, capital repairs, or prior-year deficits force a substantial increase.
A board should not deliberately underfund a necessary budget merely to remain below the 115% rule. Suppressing known expenses can produce larger special assessments, delayed maintenance, depleted reserves, and more serious financial pressure later.
The board’s responsibility is to adopt a supportable budget, provide the required notices, document the calculation, and follow the proper procedure if a valid owner petition is delivered.
How the 115% Rule Works for Condominium Associations
For associations governed by the Illinois Condominium Property Act, owners holding at least 20% of the association’s votes may submit a written petition after the board adopts a budget or separate assessment that crosses the statutory threshold.
The petition must be delivered to the board within 21 days after the board action. The board must then call a meeting of the unit owners within 30 days after receiving the petition.
At that meeting, the budget or separate assessment is rejected only if a majority of the total votes of all unit owners is cast against it. If that association-wide majority is not reached, the budget or assessment is ratified.
The condominium 115% rule therefore contains two separate thresholds:
- Owners holding 20% of the association vote can require the meeting.
- Owners holding more than 50% of the total association vote must vote to reject the board’s action.
A majority of the owners attending the meeting is not sufficient unless those owners also represent a majority of the total association vote.
How the 115% Rule Works Under CICAA
For common interest community associations governed by the Common Interest Community Association Act, commonly called CICAA, the basic procedure is similar, but the petition deadline is shorter.
Members holding at least 20% of the association votes must deliver the written petition within 14 days after the board action. The association must call the membership meeting within 30 days after receiving the petition.
As with a condominium association, a majority of the total association votes must be cast at the meeting to reject the budget or separate assessment. Otherwise, the board’s action is ratified.
The difference between the condominium association’s 21-day deadline and CICAA’s 14-day deadline is operationally significant. Management must confirm which statute governs the association before giving owners a deadline or advising the board how to respond under the 115% rule.
A Petition Does Not Reject the Budget
The phrase “petition to reject the budget” can make the 115% rule sound easier to use than it is.
A successful petition does not reject the budget. It only requires the board to call a membership meeting.
Actual rejection occurs only when a majority of the total association vote is cast against the budget or assessment.
Assume a condominium contains 200 units with one equal vote per unit. Forty votes could be sufficient to deliver the petition. At least 101 votes would ordinarily be needed to reject the board’s action.
If 80 owners attend the meeting and all 80 vote against the budget, the budget is not rejected. Eighty votes represent a majority of those attending, but not a majority of the entire association.
The 115% rule is therefore a meaningful owner protection, but it is not a low-threshold veto.
Voting Percentages May Not Equal the Number of Units
Boards and owners should not assume that 20% of the units always equals 20% of the association vote.
Condominium voting rights are frequently allocated according to each unit’s percentage interest in the common elements. Larger units may hold a greater percentage of the association vote than smaller units.
A petition signed by owners of 20 out of 100 units may therefore represent more or less than 20% of the total vote.
Management should verify the voting allocation established in the declaration before determining whether a petition satisfies the 115% rule.
Emergency and Legally Mandated Assessments
Not every significant assessment is subject to the ordinary 115% rule procedure.
Under both the Condominium Property Act and CICAA, separate assessments for qualifying emergencies or expenditures mandated by law may be adopted without being subject to the standard owner-petition procedure.
The Condominium Property Act defines an emergency as an immediate danger to the structural integrity of the common elements or to the life, health, safety, or property of unit owners. CICAA addresses dangers to structural integrity and dangers to the life, health, or safety of the membership.
Boards should not classify an expensive or unexpected project as an emergency merely because funding is difficult. Association counsel should determine whether the statutory exception applies.
Additions and Alterations Follow Different Rules
Assessments for additions or alterations to common property can also fall under separate approval provisions.
Under the Condominium Property Act, certain additions and alterations not included in the adopted annual budget require approval by two-thirds of the total unit-owner votes.
Under CICAA, additions and alterations to common areas or association-owned property that were not included in the annual budget generally require approval by a simple majority of the total members at a meeting called for that purpose.
These provisions should not be combined into one generic “15% rule.” The reason for the assessment, the governing statute, the governing documents, and the structure of the board action all matter.
What Boards Should Document Before Budget Adoption
Before adopting the budget, the board and management should calculate the prior-year assessment total and identify every regular and separate assessment payable during that year.
The same calculation should then be completed for the proposed fiscal year.
The board packet should preserve:
- The prior-year assessment total
- The proposed assessment total
- Any separate assessments included in either year
- The percentage of increase
- The conclusion as to whether the 115% rule applies
- The budget and meeting notices provided to owners
The minutes should accurately identify the budget or separate assessment adopted, the payment period, the amount, and the board vote.
If a petition arrives, management should immediately record the date of delivery, preserve the original petition, calculate the percentage of votes represented, and send the materials to association counsel.
The statutory 30-day meeting period begins when the petition is delivered. Delay in reviewing the petition can create unnecessary procedural risk.
Budget Notice Requirements Still Apply
Remaining below the 115% rule does not eliminate the board’s other budget obligations.
Condominium owners must generally receive a copy of the proposed annual budget at least 25 days before adoption. CICAA members must receive the proposed annual budget at least 30 days, but not more than 60 days, before adoption. The budget must identify amounts intended for reserves, capital expenditures, repairs, or real estate taxes.
A budget increase can be legally valid and still be poorly communicated.
Boards should explain the major cost drivers, insurance changes, capital obligations, reserve needs, contract increases, prior-year deficits, and consequences of deferring necessary work.
Owners are more likely to understand a substantial increase when the board’s financial reasoning is specific, documented, and presented before the adoption meeting.
Applying the 115% Rule Correctly
The 115% rule is a statutory procedure, not a budgeting strategy.
Boards should not treat 15% as the maximum increase they believe they are permitted to adopt. Owners should not assume that 20% of the community can overturn a budget.
Twenty percent can force the meeting. A majority of the entire association must reject the board’s action.
Williamson Management helps Illinois condominium, townhome, and homeowner association boards prepare realistic budgets, maintain accurate assessment records, coordinate required notices, verify voting percentages, and manage the administrative procedures that follow board action.
Association counsel should review any disputed calculation, petition, emergency assessment, or owner vote involving the 115% rule.
With over 30 years in community association management across the U.S., Annette Byrd brings executive leadership, legislative advocacy, and a passion for serving HOA and condo boards with integrity and expertise. She is the visionary behind Williamson Management’s commitment to exceptional service and practical guidance for communities.
