2018 Legislative Changes That Affect Community Associations

08/14/2018 by Deborah M. Casey

Each year an increasing number of bills affecting community associations are introduced in the Virginia General Assembly.  2018 may have been one for the record books. CAI’s Virginia Legislative Action Committee (VALAC) reviewed more than 100 bills that directly or indirectly affect Virginia community associations. Fortunately, there are only a few that passed.  The bills that passed became effective July 1, 2018.  Listed below are the ones with the most direct impact.

  1. Revised Resale Certificate/Disclosure Packet Cover Sheet (HB923). Beginning July 1, 2018, the cover sheet developed by the CICB that must accompany all resale certificates and disclosure packages was updated to include additional disclosures, as applicable. The form no longer is limited to one page.  The new forms can be found here for condominiums and here for property owners’ associations. 

Resale certificates and disclosure packages may be the sections of the Condominium and Property Owners’ Association Acts that get the most attention in the legislature each year.  It is almost a given that at least one bill will be introduced each year and that new requirements will be included.

→ Practice Pointer:  Whether prepared in house or contracted out, every association should perform an annual review of its resale certificate/disclosure packet form to ensure continuing compliance with the relevant act.  The CICB cover sheet form follows the Code and provides a great checklist and format for associations to utilize.

Amends Va. Code:  §§54.1-2350, 55-79.97 and 55-509.5

  1. Prerequisites to Fees for Disclosure Packets (HB1031). Beginning July 1, 2018, property owners’ associations (POA), whether or not professionally managed, may not charge or collect any fees in connection with preparing a disclosure package unless the association is:

(i)   registered with the CICB;

(ii)  current in filing the most recent annual report with the CICB; 

(iii) current in paying the annual payment to the CICB pursuant to Va. Code Section 55-516.1 and any assessment made by the CICB pursuant to Va. Code Section 55-530.1; and

(iv) provides the disclosure packet electronically if so requested by the requester.

In addition, a self-managed POA may charge and collect fees for inspection of the property, the preparation and issuance of a disclosure packet, and such other services set forth in Va. Code Section 55-509.6 (professionally managed associations) if the association provides the packet electronically if so requested and otherwise complies with Va. Code Section 55-509.6.

Further, a POA that is self-managed may charge fees at the option of the seller or the seller’s agent, with the consent of the association, for:

(i)  expediting the inspection, preparation or delivery of the packet, if completed within 5 business days of the request, not to exceed $50;

(ii)  an additional hard copy of the packet not to exceed $25 per hard copy; and

(iii)  third-party commercial delivery service for hand or overnight delivery of the packet not to exceed the actual cost paid.

→Practice Pointer:  Make it a point each year at a designated time to check the status of the community’s registration with the Common Interest Community Board.  Now, it is not only required, but it is a prerequisite to collecting fees in connection with a disclosure packet.

Amends:  Va. Code §§55-509.4, 55-509.6 and 55-509.7

  1. Duty to Redact Association Books and Records (SB722). Effective July 1, 2018, books and records kept by or on behalf of a community association shall be withheld from inspection and copying in their entirety only to the extent exclusion from disclosure applies to the entire document.  Otherwise, only those portions containing information subject to an exclusion may be withheld or redacted.  The actual cost for redaction is a cost that may be recovered.

→Practice Pointer:  Treat records requests with the utmost care, being careful to redact or withhold only those portions that may be withheld pursuant to Va. Code Sections 55-74:1C or 55-510C.

Amends:  Va. Code §§ 55-79.74:1, 55-509.3:2 and 55-510

If you have any questions about the new laws and how to comply, please contact your community association counsel.

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