2017 Maryland Condo and HOA Legislation–What’s Hot and What’s Not

With the Maryland General Assembly now in the final month of the 2017 legislative session which ends on April 10, several bills regarding community associations are still under consideration.  Other bills have died in committee.  A bill must be passed by the Maryland House and Senate and signed by the Governor in order to become law.

Here’s What’s HOT!

State Registration of Community Associations.  Legislation to require each condo, co-op and HOA to register with the state has been passed by the House after it was amended to limit the information required.  For communities which already register with the county, no additional state registration would be required. The bill is now under review in the Senate.

Manager Licensing.  A bill to require community managers to obtain a State license has been introduced again this year.  Manager licensing legislation was previously considered in 2014 and is under study again in the House of Delegates.  The proposed legislation would require a manager to have specified training, pass a test and pay a license fee in order to provide management services to condos, coops and HOAs.

Replacement Reserves for Capital Expenditures.  Every five years, each condominium and homeowners association would be required to obtain a study of the estimated costs to repair and replacement of building structural components, roads, recreation facilities and other similar items.  The House has passed this legislation which is now under review in the Senate.

Foreclosure Sale Notice.   A lender which sells a property at foreclosure would be required to give written notice of the proposed sale to any condo or HOA which has recorded an assessment lien against the property at least 30 days before the sale date.  Notice of any postponement or cancellation  of the foreclosure sale must also be provided to the property owner, condo and HOA.  This legislation has passed both the House and Senate.

Governing Documents.  Still under study are bills to make it easier to amend condo and HOA governing documents and to invalidate condo document provisions which limit the time for bringing condominium legal claims regarding construction defects.

Here’s What’s NOT

Electric Vehicle Charging Stations.  A bill to invalidate condominium and homeowner association covenants which prohibit or unreasonably restrict the installation electric vehicle charging stations in parking spaces designated for the exclusive use of a homeowner was killed by House and Senate committees.

Backyard Gardens.  Also killed in committee was a bill to invalidate association covenants which prohibited gardens in the backyard of a home.

Smoking Restrictions.  Legislation to allow the board of directors of a condominium or homeowners association to adopt rules to prohibit tobacco smoking in an owner’s  condo or townhome was voted down in committee.

For updates and details on legislation affecting Maryland condos, co-ops and homeowner associations, sign up for the Maryland Condominium & HOA Law Blog to receive the latest blogposts by email.

Posted by Thomas Schild Law Group, LLC, attorneys for condominiums, homeowner associations and housing cooperatives in Maryland–including Montgomery County, Prince George’s County, Howard County, Frederick County, and Baltimore County; and in Washington, D.C.

 

Maryland Top Court to Review Condo Towing Rule

To tow or not to tow…with apologies to William Shakespeare, that is the question at the heart of long-running litigation between an Anne Arundel County condominium and owners whose vehicles were towed from the condo parking lot.  The Maryland Court of Appeals will soon resolve the dispute over a condominium association’s authority to suspend a condo owner’s use of the common elements when the owner is in arrears in payment of condominium assessments. Continue reading

2017 Maryland Legislative Session Begins

Outside the glare of worldwide attention to the inauguration of Donald Trump as the President of the United States, the Maryland General Assembly began its 2017 90-day legislative session in mid-January.

Some bills considered–but not enacted–in 2016 will be examined again by legislative  committees in the Maryland House of Delegates and Maryland Senate.  This includes legislation to establish a state registry for common ownership communities, to require lender notice to condominiums and homeowner associations when a lender postpones or cancels a foreclosure sale, and to make it easier to amend the governing documents of condominiums and homeowner associations.

Other proposed legislation would require Maryland community association managers to obtain a state license to provide management services and establish a State Board of Common Ownership Community Managers.  Several bills would limit the authority to prohibit or regulate uses such as electric vehicle charging stations and backyard gardens.  Also under consideration is a bill to require condos and HOAs to obtain an independent reserve study of the condition of the common areas every 5 years to determine future costs of major repairs and replacement.

A legislative committee will receive comments on each bill and make a recommendation on whether the bill should become law.  Only legislation which is passed by both the House and Senate, and approved by the Governor becomes law.

For updates and details on legislation affecting Maryland condos, co-ops and homeowner associations, sign up for the Maryland Condominium & HOA Law Blog to receive the latest blogposts by email.

Posted by Thomas Schild Law Group, LLC, attorneys for condominiums, homeowner associations and housing cooperatives in Maryland–including Montgomery County, Prince George’s County, Howard County, Frederick County, and Baltimore County; and in Washington, D.C.

FHA Condo Certification Rule Awaits Review by Trump Administration

The Federal Housing Administration (FHA) recently issued its long-awaited proposed rule regarding standards for condominiums in which individual unit owners are eligible to obtain FHA-insured loans.  However, final action awaits review by new housing agency officials in the Trump Administration.

Mortgages backed by the FHA allow borrowers to make a lower down payment and have less stringent financial qualification criteria than conventional  mortgages. Of the estimated 150,000 condominium nationwide, fewer than 10,000 are certified for FHA-insured loans. Continue reading

Will Community Associations Get Trumped?

The election of Donald Trump as the President of the United States ushers in uncertainty for a variety of federal housing policies which affect the financing and governance of homes in community associations–condominiums, homeowner associations and housing cooperatives.  During the election campaign, Trump said little about the federal role in promoting homeownership.

But, his support for reduced government regulation and the 2016 Republican Platform provide clues about how a Trump Administration may impact community associations. Continue reading

New Fair Housing Harassment Rules Apply to Community Associations

Condominiums, housing co-ops and homeowner associations may be liable for the conduct of community residents which subjects other residents to “hostile environment harassment” under new rules issued by the United States Department of Housing and Urban Development (HUD).

The new fair housing rules, which apply beginning October 14, 2016, establish nationwide standards which HUD will apply in enforcing the federal Fair Housing Act with respect to alleged harassment based on race, color, religion, national origin, sex, familial status or disability. According to HUD, the rules do not create any new forms of liability under the Fair Housing Act but merely clarify HUD’s enforcement policies on “quid pro quo” and “hostile environment” harassment.  In addition, the rules clarify when a person may have vicarious liability for the actions of agents and employees in the context of discriminatory housing practices.

The new HUD rules define “hostile environment harassment” to mean “unwelcome conduct that is sufficiently severe or pervasive as to interfere with the availability, sale, rental, or use or enjoyment of a dwelling” and other housing-related activity.  Whether hostile environment harassment exists will be evaluated from the totality of the circumstances and from the perspective of a reasonable person in the aggrieved person’s position.

“Quid pro quo” harassment refers to circumstances where submission to an “unwelcome request or demand” is a condition related to housing transactions or services.

In addition to liability for a person’s own conduct and the conduct of that person’s agents and employees, the new fair housing rules also make a person liable for failing to take prompt action to correct and end a discriminatory housing practice by a third-party, where the person knew or should have known of the discriminatory conduct and had the power to correct it.

The HUD explanatory statement accompanying the rules specifically addresses the obligations of condominiums, homeowner associations and housing co-ops to act to correct a discriminatory housing practice by taking “whatever actions it legally can take to end the harassing conduct”.  And, HUD refers to the 2015 decision of the United States Supreme Court in Texas Department of Community v. Inclusive  Communities Project, Inc. in support of its position that a person’s failure to act to correct third-party harassment does not need to be motivated by a discriminatory intent in order to be liable for a Fair Housing Act violation.

Posted by Thomas Schild Law Group, LLC, attorneys for condominiums, homeowners associations and housing co-operatives in Maryland–including Montgomery County, Prince George’s County, Howard County, and Frederick County; and in the District of Columbia.