CAI’s Pennsylvania Legislative Action Committee spent the day at the state capitol in Harrisburg on Monday, April 24 meeting with legislators and legislative staff in a continuing effort to educate lawmakers on issues confronting community associations in the Commonwealth. The day also helped to tee up several pieces of legislation on the LAC’s priority list for the current legislative term.
The LAC cleared the deck, so to speak, during the last legislative session which ended on November 30, 2016 and saw three of the LAC’s priority Bills passed and signed into law by the Governor, including legislation which eliminated the unnecessary conflict of legal statutes to which condo associations and planned communities were exposed in the Shaffer v Zoning Hearing Board of Chanceford Township legal case; a Bill which ensured that community associations were not affected negatively by a recent U.S. Court of Appeals decision and new federal mortgage underwriting guidelines; and, finally, legislation putting an end to per parcel recording fees for Declaration Amendments that were costing community associations thousand and tens of thousands of dollars.
With those Bills now law, the LAC has turned to two priorities and is working to secure legislative action this year on both.
The first priority is Omnibus Amendments to Title 68. These amendments to the statutes governing common interest ownership communities in the Commonwealth are all intended to clarify existing provisions of the Uniform Condominium Act, Real Estate Cooperative Act, and Uniform Planned Community Act (the Acts), and enhance the overall administration and governance of Pennsylvania’s community associations. As currently proposed, these amendments relate to five (5) specific sections within each of the Acts and three (3) pertaining just to the UPCA. Specifically, they address the powers of the association; the conveyance and encumbrance of common elements; the release of liens from real estate to be conveyed to the association; the declarant's warranty against structural defects; the definition of, and disclosure requirements for, common facilities; and the contents of a recorded declaration. The proposed amendments are designed to be entirely consistent with the statutory scheme already put in place by the Legislature and the consumer protection policies and purposes embodied in the Acts. A brief summary of the proposed amendments is below.
- Expressly provides the statutory authority for what already exists in many associations’ governing documents with respect to the suspension of unit owners’ privileges in the event of delinquencies in the payment of assessments or uncured violations of an association’s declaration, bylaws and/or rules and regulations.
- Insures that the existing statutory requirement for the turnover of control of an association’s board of directors from the declarant to the unit owners is satisfied without undue delay or prejudice to the interests of the homeowners. If a declarant fails to hold an election meeting at the time a declarant’s control terminates, then an executive board member elected by the unit owners, or alternatively, unit owners entitled to cast at least ten (10%) percent of the votes, may call for a special meeting to elect a homeowner-controlled board.
- Clarifies and cures any ambiguity in the existing statutory sections relating to the conveyance or encumbrance of common elements. Specifically, the amendments confirm that the procedures and voting requirements currently set forth in this section in connection with a conveyance or encumbrance of common elements are equally applicable to a tax sale or an involuntary transfer of the common elements, and further, that any interest in the common elements which is subject to the declaration prior to a conveyance or encumbrance, shall remain subject to the declaration following such conveyance or encumbrance, absent provisions in the deed or agreement to the contrary.
- Clarifies and firmly establishes that the declarant’s obligation to release real estate from liens before conveying such real estate to the association includes unpaid real estate taxes on that real estate.
- Regarding declarant’s warranty against structural defects, and consistent with the consumer protection purposes of the Acts, provides that an association’s right of action under this section is tolled until the period of declarant control terminates.
- Expands the definition of “common facilities” in the UPCA so as to include terms frequently used by declarants interchangeably with the term “common facilities” in governing declarations and plats and plans, such as “common area” or “open space”.
- Confirms that the existing requirements under Section 5205 of the UPCA relating to the contents of a recorded declaration and the declarant’s reservation of special declarant rights remain in effect and are enforceable even in those instances where the declarant may fail to include such express provisions in the declaration.
- Clarifies and resolves any ambiguity concerning the scope of the declarant’s disclosure requirements in designating a portion of the planned community as a “common facility” to be owned or leased by the association.
The second piece of legislation on the LAC’s priority list is commonly referred to as the Planned Unit Development Data Transparency Act, which would amend the Municipalities Planning Code to require County Planning Commissions to include common interest ownership community (CIOC) data in their currently required annual report.
In 2011, the Pennsylvania Joint State Government Commission issued a report titled “Common Interest Ownership Communities (CIOCs) in the Commonwealth of Pennsylvania” pursuant to House Resolution 350 of 2009. CIOCs are defined in Title 68 of the Pennsylvania Consolidated Statutes, Real and Personal Property, as Condominiums, Cooperatives and Planned Communities. Recognizing the lack of transparent data on the estimated 10,000 community associations in Pennsylvania, the Joint State Government Commission, in its report, recommended “The MPC should be amended to require County Planning Commissions to track certain information on CIOCs, including their names, physical locations, land area, lot size and number of units, presence of a mixed use development, infrastructure including sanitary sewer, water and stormwater systems, dedication of roadways including roads built to specifications, common infrastructure and recreation facilities, and articles of incorporation or other non-profit organization registration information filed with the Department of State.”
This legislation would accomplish the above policy recommendation from the Joint State Government Commission. Counties would be required to collect, maintain, and make available upon request, information identifying condominium associations, cooperative housing developments, and planned communities located within the boundaries of the County. While it is estimated that 2.8 million PA residents live in a common interest ownership community and that roughly 80 percent of new housing starts since 2000 are CIOCs, the actual number and location of these communities is, by and large, unknown. This Bill would mandate the collection of data and would aid the State in assessing the impact of legislation specific to CIOCs. To mitigate the impact on County governments, amendments to the original bill, initially introduced in the last session, would permit the County to make the data available to the public at a cost not to exceed that allowed under the state Right to Know Law and would also permit the posting of the data in electronic form.
In addition to the reasons stated in the Joint State Government Commission Report. There are important public policy reasons for the legislature to mandate the transparency of this data, including to mitigate any public impact from the failure of various types of infrastructure such as private dams, bridges, and stormwater management facilities, to name a few. There are also public safety benefits. Under Megan’s Law, local police are mandated to report the presence of certain sexually violent predators to neighbors, and further states “Where the sexually violent predator lives in a common interest community, the term "neighbor" includes the unit owners' association and residents of the common interest community.” If the presence of a unit owners association is not known, compliance with this section is not possible.
In a more specific case, the presence of a unit owners association was not initially known by state police during the 2014 search in the Poconos for convicted cop killer Eric Frein. In the initial days of the search, which was concentrated near and within The Hamlet Property Owners Association in Canadensis, PA, officers were trying to gain information about the presence of the association and nearby communities. The resulting cooperation between state police and management of The Hamlet aided the search efforts as well as the ability to communicate with residents of The Hamlet and other nearby private communities. Unfortunately, information on some smaller CIOCs in the area was not able to be obtained. This partnership underscores the real impact of readily available and transparent information on CIOCs throughout the Commonwealth.
For continuing updates on these and other legislative issues impacting Pennsylvania’s community associations, please visit the legislative pages of our website.