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House Bill Would Make Changes In Condominium Governance, Particularly During The Period of Developer Control

House Bill 140, now pending in the Maryland General Assembly, would make several amendments to the Maryland Condominium Act relating to governance during the period of developer control and, in all condominiums, would expand unit owner participation in meetings of the board of directors.  In proposed new provisions to Section 11-109(c)(8) of the Maryland Condominium Act, the Bill would require a developer in control of a condominium to appoint a unit owner to the board of directors.  Where a developer controlled condominium has a board of directors and 25% of the units have been sold, the developer would be required to appoint at least one unit owner, not affiliated with the developer, to the board.  Where there is no board of directors, once 25% of the units are sold, the developer would be required to establish a board of directors, including at least one unit owner, not affiliated with the developer.

The Bill would also require and additional open agenda board meeting per year that provides an opportunity for unit owner comment.  Section 11-109(c) presently requires that condominium boards hold at least one such meeting each year.  House Bill 140 would amend this provision to require a board of directors to hold two such open agenda meetings per year.   This requirement would also apply to board meetings during the period when the developer is still in control of the condominium.

Additionally, the Bill would add a new provision to Section 11-116 requiring that, during the period of developer control, the condominium’s books and records be maintained “separate and apart from the developer or of any other person.”

The Bill proposes to add similar provisions to the Maryland Homeowner Association Act.  Please watch this blog for further developments on this legislative proposal.