Articles

Virginia: 2018 Legislative Update for Common Interest Communities

By: Kevin Kernan, Esq. and Alysia Yi, Esq. 

The Virginia General Assembly approved a number of bills during its 2018 legislative session.  Several of the bills impact, directly or indirectly, common interest communities.  The Governor of Virginia signed the following bills into law in March and the new laws will take effect on July 1, 2018, except as otherwise noted herein.  We have outlined the substantive legislative action taken by the Virginia General Assembly that impacts both homeowners and condominium associations.

The following bills amend the Virginia Property Owners' Association Act (Va. Code Ann. 55-508, et seq., as amended (1950)), the Virginia Condominium Act (Va. Code Ann. 55-79.39, et seq., as amended (1950)), and other statutes that may affect common interest communities.  Please feel free to contact us if you have questions regarding any of the following legislative changes.

Nonstock Corporations Members' Meetings

House Bill 1205 amends §§ 13.1-838, 13.1-839, 13.1-842, 13.1-844.2, and 13.1-845 of the Virginia Nonstock Corporation Act.  The bill authorizes the board of directors of a nonstock corporation to determine that any meeting of members, either a special or annual meeting,  may be held by means of remote communication, but only if the articles of incorporation or bylaws do not require the meeting to be held at a certain location.  Since most homeowners associations are incorporated in Virginia, this bill allows homeowners association meetings to be held remotely.  Keep in mind that the Association will need to implement reasonable measures to allow members to participate and vote in a meeting that is held remotely.     

Duty to Redact Association Books and Records

Senate Bill 722 amends § 55-79.74:1 of the Virginia Condominium Act (“Condo Act”) and §§ 55-509.3:2 and 55-510 of the Virginia Property Owners' Association Act (“POAA”).  The bill provides that books and records kept by or on behalf of an owners' association shall be withheld from examination and copying in their entirety only to the extent that an exclusion from disclosure enumerated in the Condo Act or POAA, as applicable, applies to the entire content of such books and records.  Otherwise, only those portions of the books and records containing information subject to an exclusion may be withheld or redacted, and all other portions of the books and records must be made available for examination and copying.  An Association will no longer be able to withhold books and records when only certain portions of the books and records are eligible to be withheld from disclosure under the Condo Act or POAA.  The Association is permitted to charge the requesting member reasonable costs incurred by the Association for responding to the records request and redaction of the appropriate portions.   

Disclosure Packets: Fees and Electronic Delivery Requirements

House Bill 1031 amends §§ 55-509.4, 55-509.6, and 55-509.7 of the Virginia Property Owners' Association Act (“POAA”) under which associations can charge fees for the preparation and delivery of resale disclosure packages.  This bill does not affect fees for condominium associations.

The bill amends the POAA to provide that homeowners associations may not collect a fee for preparation and delivery of resale disclosure packages, whether professionally managed or self-managed, unless the association:

• is registered with the Common Interest Community (“CIC”) Board;
• is current in filing the association's most recent annual report with the CIC Board;
• is current in paying the annual payment and assessment to the CIC Board (payable at registration and with each annual report filed with the CIC Board); and
• for professionally managed associations, the association can provide the disclosure package electronically, if requested.

The bill also amends the POAA is to give homeowners associations that are not professionally managed the right to charge certain fees that currently can only be charged by professionally managed associations including:

• a reasonable fee (not to exceed $50.00) for expediting the inspection, preparation and delivery of the disclosure package if such expedited delivery can be accomplished within five (5) days – and only if expedited delivery is requested;
• $25.00 for each additional hard copy requested;
• the actual cost of using a third-party commercial delivery service or overnight delivery, if requested; and
• a $100.00 fee for inspection of the lot and exterior of the dwelling as required to prepare the disclosure package.

CIC Board Form for Association Disclosure Packets and Resale Certificates

House Bill 923 amends § 54.1-2350 of the Code of Virginia, relating to the Common Interest Community (“CIC”) Board, § 55-79.97 of the Virginia Condominium Act, and § 55-509.5 of the Virginia Property Owners' Association Act (“POAA”).  The bill requires the CIC Board to reconfigure its current one-page disclosure form that accompanies disclosure packets for prospective purchasers of lots located within a homeowners association  and it now requires the reconfigured CIC Board form to also accompany resale certificates provided to prospective purchasers of condominium units located within a condominium unit owners association.   

The reconfigured CIC Board form must include additional information to provide potential purchasers notice of certain restrictive covenants that may affect the potential purchaser's decision to purchase a lot or unit located within a common interest community.

The disclosure form now must contain the following statements to alert buyers to certain aspects of ownership in a community association even though some of these items will not apply in every community: 

• limitations on an owner's ability to rent his/her unit;
• limitations on an owner's ability to park or store certain types of motor vehicles or boats within the community;
• limitations on an owner's ability to maintain an animal as a pet within the lot or unit or within the common areas;
• architectural guidelines applicable to an owner's lot or unit;
• limitations on an owner's ability to operate a business within a dwelling or condominium unit; and
• the period or length of declarant control.

The CIC Board disclosure form must also contain the following statements:

• the purchaser is responsible for his own examination of the documents included in the resale disclosure;
• the purchaser shall carefully review the entire resale certificate or disclosure package; and
• the contents of the resale certificate or disclosure package shall control to the extent that there are any inconsistencies between the CIC Board form and the resale certificate or disclosure package

Authority of Special Conservators of the Peace

House Bill 151 amends § 19.2-13 of the Code of Virginia, relating to Special Conservators of the Peace (“S-Cops”), who are sanctioned by court orders and regulated by the Department of Criminal Justice Services.  S-Cops can be contracted by homeowner's associations and have arrest powers, can be armed with a gun and Taser, and can serve documents like warrants.  This bill limits the powers provided in the power of appointment for an S-Cop to only the duties for which the S-Cop is qualified by training as established by the Criminal Justice Services Board. 

Additionally, the bill requires the order of appointment to provide that such duties shall be exercised only in the geographical limitations specified by the court and that it delineate a geographical limit or distance beyond which the S-Cop may not effectuate an arrest following a close pursuit.  The bill now prohibits S-Cops contracted by a homeowners association from using the word “police” and from using the seal of the Commonwealth on their equipment in the performance of their duties.

Local Regulation of Solar Facilities

Senate Bill 429 and House Bill 508 amend the Code of Virginia by adding § 15.2-2288.7, relating to local regulation of solar facilities.  The bills provide that a property owner may install a solar facility on the roof of a dwelling or other building to serve the electricity or thermal needs of that dwelling or building, or install a ground-mounted solar energy generation facility, provided that such installation is in compliance with any height and setback requirements in the zoning district where such property is located as well as any provisions pertaining to any local historic, architectural preservation, or corridor protection district.  The provision of the bills with respect to ground-mounted solar energy generation facilities will take effect on January 1, 2019. 

However, the bills make clear that the amended statutory language does not  supersede or limit contracts or agreements between or among individuals or private entities related to the use of real property, including recorded declarations and covenants found in the governing documents of a condominium unit owners' association, the declaration of a property owners' association,  the cooperative instruments of a cooperative, or the declaration of a common interest community as defined in § 55-528 of the Code of Virginia.