Two More Bills Cross the Finish Line and Two More Get Close

Written by: on Wednesday, April, 24th, 2013

As the legislative session winds down, two more bills were quickly approved by the Senate and House and sent to the Governor for signature.  SB 13-126 The bill that removes unreasonable restrictions on electric car charges and SB 13-182 a bill that addresses time share interests were both sent to the Governor on April 23, 2013.  We expect the Governor to sign both bills.

As passed, SB 13-126 prohibits an association from denying a request to install either a level one or level two charging station.  However, an association may condition the installation of the charging station (1) on safety requirements, (2) with reasonable aesthetics that may govern the dimensions, placement or external appearance of the charging station, and (3) may require the charging station be registered with the Association.  The Association may also charge a reasonable fee for the electricity used by the charging station if the charging station is “plugged into” the Association’s electricity.

In order to comply with these requirements, the Association should adopt standards for the placement of the stations in the community prior to receiving a request for installation.  The standards should indicate general locations that the stations will be permitted in the community, how they should be mounted and if needed, what the charge for use of the station will be on a monthly basis.  Having these standards in place prior to receiving the request will enable the association to quickly approve the requests and avoid any undue issues. This bill, which will appear at 38-33-3-106.8, will impact nearly every community in the state.

SB 13-182 on the other hand only impacts owners of time share interests, and is an attempt to protect both the owner of the time share estate from problematic resale companies but along with time share communities.  The bill, which will be codified at 6-1-102 et seq., prohibits the practice of selling time share interests to a shell company that has no intention of fulfilling the obligations of the interest to the Association.  Currently, companies claim they can free the owner of a time share interest of all obligations of the time share, including the annual maintenance fees.  The company will then require the owner to pay the company a fee to take title.  The company will then convey the interest into a shell company that never makes a payment or takes any other action in relation to the interest, which has caused great financial harm to the affected communities.  This bill will invalidate those conveyances and permit the owner to cancel the transaction.  If you own a time share interest, the interest may not be more difficult to sell, however, the community will not suffer from the loss of maintenance fees and the interest may be more marketable due to the condition of the community.

In addition to the above bills, the legislature, as promised is fast tracking two additional bills.  HB 13-1134 which concerns the HOA Information and Resource Center and HB 13-1276 which concerns the debt collection practices of a common interest community both moved a step closer to passage yesterday as well. Both bills which passed out of the House last week, passed, un-amended out of committee and have been referred to the entire Senate for consideration.  HB 1134, which expands some of the duties of the HOA Information and Resource Center among other things, will clean up the confusion as to which associations in the state are required to register.  If passed and signed into law, all associations, regardless of whether the association is pre or post CCIOA, will be required to register.

HB 1276 has a more immediate impact on common interest communities in that the Bill further governs how an association may conduct collection of past due assessments.  The Bill requires associations to offer a six month payment plan for delinquencies so long as the owner stays current on the assessments and the payment plan.  Additionally, the delinquency notices provided by the Association will need to be revised to contain certain statutorily required information, such as the name and phone number of the person to call to discuss the delinquency as well as the association’s enforcement rights and remedies.  This Bill will require a revision to the Association’s existing collection policy to address these changes.

We will continue to monitor these bills and let you know of any changes.

David A. Firmin