The bill amends Chapter 34-36.1, known as "Condominium Law," to introduce new definitions and provisions aimed at improving governance and financial management within condominium associations. Key insertions include definitions for "annual budget," "capital expense," "common elements," "condominium fees," "deed-restricted unit," and "special assessment," which clarify the financial responsibilities of unit owners and outline the management of unexpected expenses.

The bill establishes limits on increases in monthly common expenses to no more than five percent (5%) of the previous year's monthly common expenses for associations where less than fifty percent (50%) of the units are deed-restricted units. Additionally, it limits special assessments for unforeseen costs not included in the approved annual budget for these associations, capping the assessment attributed to deed-restricted units at fifty percent (50%) of the full assessment. Associations must also allow owners of deed-restricted units the option to enter into a monthly payment plan for special assessments.

Furthermore, the bill mandates that executive boards established after June 30, 2026, must be comprised of members proportionate to the number of deed-restricted and market-rate units, ensuring fair representation. It requires all associations to register with the Department of Housing by December 31, 2026, and submit essential financial documents, including the annual budget, board list, financial records, and governing documents, within thirty (30) days of adoption or amendment.

The Department of Housing's powers are expanded to include coordinating a central depository of information regarding condominium associations and investigating complaints related to these associations. The provisions of this act are set to take effect on July 1, 2026.

Statutes affected:
724: 42-64.34-2