Illinois Joins Ranks of States Looking to Change Lien Laws for Storage Auctions

Posted on Mar 29 2011 - 7:56am by John Stevens

Illinois lien law legislation is making headway in congress despite opposition from the Press Association whose newspapers would lose revenue if the changes are passed. Introduced to the Illinois 97th General Assembly in February, the lien law was passed through the Commerce Committee and now moves to the Senate.

Senate Bill 1394, if passed, would mean favorable changes for the state’s self-storage operators because the costly printing of lengthy lien-sale notifications in newspapers would be eliminated. It is opposed by the Press Association because the amount of newspaper column inches needed for each sale notice would be dramatically reduced. The publishing of an announcement in a newspaper would still be required but the new law would eliminate the requirement for a general description of the property contained in the repossessed self storage unit.

SB1394, sponsored by Senator Michael Jacobs, aims to amend the “Self-Storage Facility Act” and is being promoted by the Illinois Self Storage Association (ISSA) and the national Self Storage Association.

The proposed law also includes improvements relating to unit value limitation and the removal of vehicles from units in default. Less-expensive First Class Mail would also be allowed instead of Certified Mail to post notices to tenants in default, and establishes a late fee of $20 or 20 percent, whichever is greater. Also of benefit to self storage operators is the ISSA attempt in the law to reduce the waiting period for the disbursement of funds from a self-storage auction from two years to 90 days.

Nevada and Colorado are also working through their own proposed lien law changes. Nevada state lawmakers are considering Senate Bill 150 which would enact changes including e-mail auction notifications, newspaper-free advertising requirements, and new procedures for handling delinquent tenants’ protected property.  In Colorado, Senate Bill 11-039, “A Bill for an Act Concerning the Consequences of Default in Payments Due for Storage of Personal Property in a Self-Storage Facility” provides self storage operators with more options for lien-sale notifications and eliminates the newspaper lien-advertising requirement. The national Self Storage Association (SSA) is also helping with the passage of this bill.

As the popularity of new TV shows such as “Storage Wars” and “Auction Hunters” has thrust the self-storage industry into the reality-television limelight, streamlining lien laws across the country has become a priority for state and national self storage associations.  Across the country, fans of the TV shows have been flocking to storage auctions as novice bidders, driving up numbers of attendees at the auctions.  As a result, auctions of delinquent storage units are in high demand and meeting that demand has meant streamlining the process. The storage associations pushing for new legislation argue that current lien laws are archaic, time-consuming and costly.

Sources Used:

“Self-Storage Lien-Law Legislation Progress in Illinois.”  Inside Self-Storage. March 28, 2011. 

 “Nevada Considers Changes to Self-Storage Lien Law.” Inside Self-Storage.  Feb. 28, 2011. 

 “New Self-Storage Lien Law in Colorado One Step Closer to Approval.” Inside Self-Storage. March 23, 2011.