by Raymond Daniel Burke | Nov 6, 2024
During the 2024 Session, the Maryland General Assembly passed Senate Bill 665 and House Bill 1496, which changed the amendment process in Section 11-103(c) of the Maryland Condominium Act so, as to lower the percentage required for approval of an amendment from 80 percent to 66 -2/3 percent of the total eligible voters in the condominium. The legislation was signed by the Governor and took effect on October 1, 2024. However, the reduced percentage does not apply in the event that any units are still owned by the developer, in which case the 80 percent requirement is still applicable. Additionally, the reduced percentage requirement does not apply to a purely corrective amendment of a typographical error under Section 11-103.1, which can be accomplished by the condominium’s board of directors. Also remaining unchanged is the provision that the council of unit owners may amend the declaration to add or repeal a suspension of privileges provision by the affirmative vote of at least 60 percent of the total eligible voters of the condominium.
by Raymond Daniel Burke | Oct 22, 2024
House Bill 1227, passed during the 2024 session of the Maryland General Assembly and signed into law by Governor Moore, changes the special insurance requirements for “detached” condominium units that arose from legislation passed during the 2023 session. The 2023 legislation amended Section 11-114 of the Condominium Act concerning the mandatory insurance that is required to be maintained by the Council of Unit Owners. Those changes, which took effect on October 1, 2023, differentiated between “attached” and “detached” units for insurance purposes. Generally, a Condominium Council is required to maintain “[p]roperty insurance on the common elements and units, exclusive of improvements and betterments installed in units by unit owners other than the developer, insuring against those risks of direct physical loss commonly insured against, in amounts determined by the council of unit owners but not less than any amounts specified in the declaration or bylaws.” The 2023 law provided that the Council is only required to maintain insurance on “attached” units. With respect to detached units, the 2023 law specifically provided that the Council was required to maintain insurance only on the common elements and not any portion of the detached units. The new law, which took effect on October 1, 2024, now provides that the exception for detached units only applies to detached units “located within a condominium composed entirely of similar detached units.” The new law also requires that the Council must “give annual notice, in writing, of any obligation of an owner of a residential, detached unit to obtain property insurance coverage on the unit.” It also obligates the Council to provide prompt notice to unit owners of any change in insurance coverage requirements. Accordingly, the Council must now provide notice to owners of detached units that were not covered by the Council as a result of the 2023 law, but are now covered by the Council under the 2024 law because they are not located in a condominium composed entirely of detached units.
by Raymond Daniel Burke | Apr 8, 2024
I will be speaking at the Community Associations Institute’s Delmarva Breakfast Conference on Friday, April 12, 2024 at the Atlantic Sands Hotel in Rehoboth, Delaware. My primary topic will be condominium and homeowner association resale disclosure requirements.
by Raymond Daniel Burke | Aug 11, 2023
House Bill 98, making changes to condominium insurance requirements, was passed during this year’s legislative session and signed into law by Governor Moore. It amends Section 11-=114 of the Condominium Act concerning the mandatory insurance that is required to be maintained by the Council of Unit Owners. These changes, which will take effect on October 1, 2023, differentiate between “attached” and “detached” units for insurance purposes. The new law changes subsection (a)(1), which presently provides that the Council is required to maintain “[p]roperty insurance on the common elements and units, exclusive of improvements and betterments installed in units by unit owners other than the developer, insuring against those risks of direct physical loss commonly insured against, in amounts determined by the council of unit owners but not less than any amounts specified in the declaration or bylaws.” The amended provision establishes that the Council is only required to maintain insurance on “attached” units. Where units are detached, the Council is only required to maintain insurance on the common elements and not any portion of the units. Similarly, subsection (d), which provides that insurance proceeds are first to be disbursed to repair the common elements and then the units, is amended to provide that the distribution of insurance proceeds for units is only to be made in the case of “attached” units. A new subsection (e)(2) is also added, which expressly requires that “and owner of a residential detached unit shall carry homeowners coverage on the entirety of the unit.”
by Raymond Daniel Burke | Mar 9, 2023
House Bill 55, now pending in the Maryland General Assembly, would authorize a county or municipality to “establish a local trust fund or other appropriate fund for the purpose of repairing or rehabilitating infrastructure with communities that are subject to the requirements of the Maryland Condominium Act or the Maryland Homeowners Association Act.” The bill, which would add new Section 1-1318 to the Local Government Article, is expressly intended to address circumstances in communities in which the original developer designated roads and other infrastructure a private components to be owned and maintained by the condominium associations or homeowners associations. The Bill’s preamble notes that owners living in such communities “are burdened by paying for repairs and services for the types of infrastructure that would otherwise be paid for by local governments, as well as paying property taxes that support this type of infrastructure in other condominium associations and homeowners associations with publicly managed infrastructure.” Any fund created pursuant to this proposed legislation could be used to repair “infrastructure that is traditionally maintained by the county or a municipality for the benefit of the public, including roads and storm management facilities,” but may not be used to repair recreational facilities used exclusively by homeowners and guests. Any such fund would be financed from property taxes paid by the members of the affected condominium or homeowners association. A county or municipality could establish eligibility requirements, but must prioritize those associations the exhibit the greatest need for repair or rehabilitation.
by Raymond Daniel Burke | Jul 15, 2022
As previously reported, during the 2022 legislative session, the Maryland General Assembly passed new legislation requiring all condominiums, homeowner associations, and housing cooperatives to undertake regular reserve studies of common area components. The Governor did not sign the bill, but it became law under Art. II, Sec. 17(c) of the Maryland Constitution, which provides that a bill send to the Governor becomes law if the Governor does not veto the bill with 30 days of its presentment. Under the new law, which takes effect on October 1, 2022, a community that has had a reserve study conducted on or after October 1, 2018 must have that reserve study updated within five years from the date to that study, and every five years thereafter. A community that has not had a reserve study on or after October 1, 2018, must undertake one no later than October 1, 2023, and that study must also be updated every five years thereafter.
