HOA Managers Professional Responsibility And Disclosure

Current law requires licensure of community association managers, also known as CAMs or 'managers', who contract with homeowners' associations (HOAs) to carry out specialized functions such as preparing budgets, hiring landscapers to maintain common areas, etc. Section 1 of the bill defines a 'small HOA community association manager' as one who services one or more HOAs with a combined total of 30 or fewer homes or condominium units. Section 1 also removes an existing exemption from the CAM licensing requirements for managers of time-share communities.

Sections 2 and 5 require the director of the division of real estate (director) to adopt less stringent credentialing, educational, and continuing educational requirements and lower license fees for small HOA managers.

Section 3 requires all managers to provide detailed disclosures of fees and charges, including any transfer fees that are payable upon sale of a unit in an HOA. A detailed listing of, and justification for, transfer fees must be provided to the parties to a purchase and sale at least 3 days before closing. The manager must also provide to any HOA with which the manager has or wishes to have a management contract, at least annually, a certified copy of his or her current and valid manager's license.

Section 4 requires the director to publish on the division of real estate's website a searchable list of CAMs and the HOAs they serve, including addresses, license status, and any pending complaints or disciplinary actions.

Section 6 adds the following acts or omissions to the grounds for discipline of a licensed manager:

• Knowingly violating or directing others to violate the covenants or rules of an HOA;
• Failing to notify and recommend corrective action to an HOA board member if the manager believes the board member is violating the law or rules governing the HOA;
• Failing to report to the director any board member who continues to violate the law or rules after being notified; and
• Violating the disclosure requirements imposed by section 3 of the bill.

(Note: This summary applies to this bill as introduced.)