The bill amends the Horizontal Property Act in Arkansas by updating definitions and provisions related to "apartments," "general common elements," and "limited common elements." It clarifies the definition of "apartment" as a designated physical portion of the property for separate ownership or occupancy, with boundaries outlined in the master deed. New definitions for "common elements," "declarant," and "development rights" are introduced, which detail the roles and responsibilities of property owners and developers. The bill also specifies the requirements for recording a master deed, including the allocation of interests in common elements and the process for amending the master deed, aiming to provide clearer guidelines for property ownership and management within condominium regimes in Arkansas.

Additionally, the bill revises Arkansas Code 18-13-116 regarding the liability for expenses and assessments among co-owners of apartments or units. It clarifies that expenses must be paid according to percentages established by the master deed rather than on a pro rata basis. New provisions are introduced for additional assessments on co-owners who rent or lease their units, covering costs related to security and wear and tear. The bill establishes that the declarant is responsible for operational expenses until declarant control terminates or five years after the first unit conveyance. It also ensures that purchasers are liable for unpaid assessments upon sale, prioritizing these amounts over other charges, except for taxes and mortgage payments. The act will apply to horizontal property regimes organized on or after September 1, 2025, with existing regimes allowed to adopt these provisions through amendments to their master deeds.

Statutes affected:
SB 323: 18-13-102(1), 18-13-102(4), 18-13-102(5), 18-13-102