requires two-thirds majority vote (§ 43)                                                                                                               

                                                                                                  

 

Senate Bill No. 438–Committee on Commerce and Labor

 

March 24, 2003

____________

 

Referred to Committee on Commerce and Labor

 

SUMMARY—Makes various changes related to common-interest communities. (BDR 10‑791)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: Yes.

 

~

 

EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to common-interest communities; requiring community managers to be certified by the Real Estate Division of the Department of Business and Industry; providing for a construction penalty if a unit’s owner fails to adhere to a certain schedule; providing for delegate or representative voting in certain common-interest community associations; requiring the election or removal of a member of the executive board of an association to be conducted by secret ballot or by delegate voting; revising the circumstances under which an association may foreclose on its lien for unpaid assessments; changing the time within which certain information must be provided to a prospective purchaser of a unit; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1  Section 1. Chapter 116 of NRS is hereby amended by adding

1-2  thereto the provisions set forth as sections 2 to 18, inclusive, of this

1-3  act.

1-4  Sec. 2.  “Certificate” means a certificate for the management

1-5  of a common-interest community issued by the Division pursuant

1-6  to NRS 116.31139.

1-7  Sec. 3.  “Community manager” means a person who provides

1-8  for the management of a common-interest community.

2-1  Sec. 4.  “Division” means the Real Estate Division of the

2-2  Department of Business and Industry.

2-3  Sec. 5.  “Management of a common-interest community”

2-4  means the physical, administrative or financial maintenance and

2-5  management of a common-interest community, or the supervision

2-6  of those activities, for a fee, commission or other valuable

2-7  consideration.

2-8  Sec. 6. “Permit” means a permit to engage in property

2-9  management issued pursuant to the provisions of chapter 645 of

2-10  NRS.

2-11      Sec. 7.  If a matter governed by this chapter is also governed

2-12  by chapter 82 of NRS and there is a conflict between the

2-13  provisions of this chapter and the provisions of chapter 82 of NRS,

2-14  the provisions of this chapter prevail.

2-15      Sec. 8.  An application for a certificate to act as a community

2-16  manager must:

2-17      1.  Include the social security number of the applicant; and

2-18      2.  Be accompanied by the statement required pursuant to

2-19  section 9 of this act.

2-20      Sec. 9.  1.  An applicant for a certificate to act as a

2-21  community manager must submit to the Division the statement

2-22  prescribed by the Welfare Division of the Department of Human

2-23  Resources pursuant to NRS 425.520. The statement must be

2-24  completed and signed by the applicant.

2-25      2.  The Division shall include the statement required pursuant

2-26  to subsection 1 in:

2-27      (a) The application or any other forms that must be submitted

2-28  for the issuance of the certificate; or

2-29      (b) A separate form prescribed by the Division.

2-30      3.  A certificate may not be issued if the applicant:

2-31      (a) Fails to submit the statement required pursuant to

2-32  subsection 1; or

2-33      (b) Indicates on the statement submitted pursuant to

2-34  subsection 1 that he is subject to a court order for the support of a

2-35  child and is not in compliance with the order or a plan approved

2-36  by the district attorney or other public agency enforcing the order

2-37  for the repayment of the amount owed pursuant to the order.

2-38      4.  If an applicant indicates on the statement submitted

2-39  pursuant to subsection 1 that he is subject to a court order for the

2-40  support of a child and is not in compliance with the order or a

2-41  plan approved by the district attorney or other public agency

2-42  enforcing the order for the repayment of the amount owed

2-43  pursuant to the order, the Division shall advise the applicant to

2-44  contact the district attorney or other public agency enforcing the

3-1  order to determine the actions that the applicant may take to

3-2  satisfy the arrearage.

3-3  Sec. 10.  1.  If the Division receives a copy of a court order

3-4  issued pursuant to NRS 425.540 that provides for the suspension

3-5  of all professional, occupational and recreational licenses,

3-6  certificates and permits issued to the holder of a certificate to act

3-7  as a community manager, the Division shall deem the certificate to

3-8  be suspended at the end of the 30th day after the date the court

3-9  order was issued unless the Division receives a letter issued to the

3-10  holder of the certificate by the district attorney or other public

3-11  agency pursuant to NRS 425.550 stating that the holder of the

3-12  certificate has complied with a subpoena or warrant or has

3-13  satisfied the arrearage pursuant to NRS 425.560.

3-14      2.  The Division shall reinstate a certificate that has been

3-15  suspended by a district court pursuant to NRS 425.540 if the

3-16  Division receives a letter issued by the district attorney or other

3-17  public agency pursuant to NRS 425.550 to the holder of the

3-18  certificate that he has complied with the subpoena or warrant or

3-19  has satisfied the arrearage pursuant to NRS 425.560.

3-20      Sec. 11.  1.  If the executive board of an association receives

3-21  a written complaint from a unit’s owner alleging that the board

3-22  has violated any provision of this chapter or any provision of the

3-23  governing documents of the association, the executive board shall,

3-24  if action is required by the board, place the subject of the

3-25  complaint on the agenda of the next regularly scheduled meeting

3-26  of the executive board.

3-27      2.  The executive board, or an authorized representative of the

3-28  association, shall, within 10 business days after receiving such a

3-29  complaint, acknowledge the receipt of the complaint.

3-30      Sec. 12.  An officer or member of the executive board of an

3-31  association or a person engaged in the management of a common-

3-32  interest community shall not solicit or accept any form of

3-33  compensation, gratuity or other remuneration that would

3-34  improperly influence or would appear to a reasonable person to

3-35  influence improperly the decisions made by those persons, or

3-36  would result or would appear to a reasonable person to result in a

3-37  conflict of interest.

3-38      Sec. 13.  A member of an executive board of an association

3-39  shall not take any retaliatory action against a unit’s owner

3-40  because the unit’s owner has:

3-41      1.  Complained in good faith about any alleged violation of

3-42  this chapter or the governing documents of the association; or

3-43      2.  Requested in good faith to review the books, records and

3-44  papers of the association pursuant to NRS 116.31175.

4-1  Sec. 14.  1.  An officer or a member of the executive board

4-2  of an association shall not:

4-3  (a) On or after October 1, 2003, enter into a contract or renew

4-4  a contract with the association to provide goods or services to the

4-5  association; or

4-6  (b) Otherwise accept any commission, personal profit or

4-7  compensation of any kind from the association for providing

4-8  goods or services to the association.

4-9  2.  Except as otherwise provided in NRS 116.3105, the

4-10  provisions of this section do not prohibit:

4-11      (a) The payment of a salary or other income to an officer or a

4-12  member of an executive board of an association for acting in his

4-13  official capacity.

4-14      (b) A declarant from entering into a contract with an

4-15  association or the payment of any consideration to the declarant

4-16  for any goods or services furnished by the declarant to the

4-17  association.

4-18      (c) The declarant from serving as an officer or a member of

4-19  the executive board of the association.

4-20      3.  As used in this section, “declarant” includes any agent,

4-21  employee or affiliate of a declarant.

4-22      Sec. 15.  1.  If the declaration so provides, in a common-

4-23  interest community that consists of at least 1,000 units, the voting

4-24  rights of the units’ owners in the association for that common-

4-25  interest community may be exercised by delegates or

4-26  representatives.

4-27      2.  In addition to a common-interest community identified in

4-28  subsection 1, if the declaration so provides, in a common-interest

4-29  community created before October 1, 1999, the voting rights of the

4-30  units’ owners in the association for that common-interest

4-31  community may be exercised by delegates or representatives.

4-32      3.  For the purposes of subsection 1, each unit that a

4-33  declarant has reserved the right to create pursuant to NRS

4-34  116.2105 and for which developmental rights exist must be

4-35  counted in determining the number of units in a common-interest

4-36  community.

4-37      Sec. 16.  1.  If a common-interest community is developed in

4-38  separate phases and the declarant, including a successor declarant

4-39  who does not control the association established by the initial

4-40  declarant, is constructing any common elements that will be added

4-41  to the common elements of the association following the date

4-42  members of the association, other than the declarant or a

4-43  successor declarant, may elect a majority of the members of the

4-44  executive board of the association, the declarant is responsible for:

5-1  (a) Paying all expenses related to the common elements which

5-2  are incurred before the conveyance of the additional common

5-3  elements to the association; and

5-4  (b) Except as otherwise provided in NRS 116.31038, delivering

5-5  to the association the declarant’s share of the amount specified in

5-6  the study of reserves completed pursuant to subsection 2.

5-7  2.  Before conveying the additional common elements to the

5-8  association, the declarant shall deliver to the association a study of

5-9  the reserves for the additional common elements which satisfies

5-10  the requirements of NRS 116.31152.

5-11      Sec. 17.  The executive board of a master association of any

5-12  common-interest community that was created before January 1,

5-13  1975, and is located in a county whose population is 400,000 or

5-14  more may record an amendment to the declaration pursuant to

5-15  which the master association reallocates the costs of administering

5-16  the common elements of the master association among the units of

5-17  the common-interest community uniformly and based upon the

5-18  actual costs associated with each unit.

5-19      Sec. 18.  1.  Notwithstanding any other provision of this

5-20  chapter, a construction penalty is enforceable against a unit’s

5-21  owner if the maximum amount of the construction penalty and the

5-22  schedule for imposing the construction penalty are set forth in:

5-23      (a) The declaration;

5-24      (b) An instrument related to the common-interest community

5-25  recorded before the date the unit’s owner acquired title to the unit;

5-26  or

5-27      (c) A contract between the unit’s owner and the association.

5-28      2.  As used in this section, “construction penalty” means an

5-29  assessment, fine, penalty or other charge imposed on a unit’s

5-30  owner because of the failure of any person to adhere to a schedule

5-31  for the completion of the design, commencement of the

5-32  construction or completion of the construction of a unit or an

5-33  improvement within the unit, or for the issuance of any necessary

5-34  permit for the occupancy of the unit or the use of the improvement

5-35  within the unit.

5-36      Sec. 19.  NRS 116.1103 is hereby amended to read as follows:

5-37      116.1103  [In] As used in the declaration and bylaws [(NRS

5-38  116.3106), unless specifically provided otherwise or] of an

5-39  association and in this chapter, unless the context otherwise

5-40  requires, [and in this chapter,] the words and terms defined in NRS

5-41  116.110305 to 116.110393, inclusive, and sections 2 to 6, inclusive,

5-42  of this act have the meanings ascribed to them in those sections.

 

 

6-1  Sec. 20.  NRS 116.110305 is hereby amended to read as

6-2  follows:

6-3  116.110305  “Administrator” means the Administrator of the

6-4  [Real Estate Division of the Department of Business and Industry.]

6-5  Division.

6-6  Sec. 21.  NRS 116.11145 is hereby amended to read as

6-7  follows:

6-8  116.11145  1.  To carry out the purposes of this chapter, the

6-9  Real Estate Commission, or any member thereof [,] acting on

6-10  behalf of the Commission, may issue subpoenas to compel the

6-11  attendance of witnesses and the production of books, records and

6-12  other papers.

6-13      2.  If any person fails to comply with a subpoena issued by the

6-14  Commission pursuant to this section , [within 10 days after its

6-15  issuance,] the Commission may petition the district court for an

6-16  order of the court compelling compliance with the subpoena.

6-17      3.  Upon such a petition, the court shall enter an order directing

6-18  the person subpoenaed to appear before the court at a time and place

6-19  to be fixed by the court in its order, the time to be not more than 10

6-20  days after the [date] service of the order, and show cause why he has

6-21  not complied with the subpoena. A certified copy must be served

6-22  upon the person subpoenaed.

6-23      4.  If it appears to the court that the subpoena was regularly

6-24  issued by the Commission, the court shall enter an order compelling

6-25  compliance with the subpoena, and upon failure to obey the order

6-26  the person shall be dealt with as for contempt of court.

6-27      Sec. 22.  NRS 116.1116 is hereby amended to read as follows:

6-28      116.1116  1.  The Office of the Ombudsman for Owners in

6-29  Common-Interest Communities is hereby created within the [Real

6-30  Estate Division of the Department of Business and Industry.]

6-31  Division.

6-32      2.  The Administrator shall appoint the Ombudsman for Owners

6-33  in Common-Interest Communities. The Ombudsman for Owners in

6-34  Common-Interest Communities is in the unclassified service of the

6-35  State.

6-36      3.  The Ombudsman for Owners in Common-Interest

6-37  Communities must be qualified by training and experience to

6-38  perform the duties and functions of his office.

6-39      4.  The Ombudsman for Owners in Common-Interest

6-40  Communities shall:

6-41      (a) Assist in processing claims submitted to mediation or

6-42  arbitration pursuant to NRS 38.300 to 38.360, inclusive;

6-43      (b) Assist owners in common-interest communities to

6-44  understand their rights and responsibilities as set forth in this

6-45  chapter and the governing documents of their associations,

7-1  including, without limitation, publishing materials related to those

7-2  rights and responsibilities;

7-3  (c) Assist persons appointed or elected to serve [on] as officers

7-4  or members of executive boards of associations to carry out their

7-5  duties; [and]

7-6  (d) Assist in resolving complaints filed with the Office or the

7-7  Division alleging a violation of the provisions of this chapter or

7-8  the governing documents of the association; and

7-9  (e) Compile and maintain a registration of each association

7-10  organized within the State which includes, without limitation:

7-11          (1) The name, address and telephone number of the

7-12  association;

7-13          (2) The name of the person engaged in [property

7-14  management for] the management of the common-interest

7-15  community or the name of the person who manages the property at

7-16  the site of the common-interest community;

7-17          (3) The names, mailing addresses and telephone numbers of

7-18  the members of the executive board of the association;

7-19          (4) The name of the declarant;

7-20          (5) The number of units in the common-interest community;

7-21  [and]

7-22          (6) The total annual assessment made by the association [.] ;

7-23          (7) The number of completed foreclosures on units within

7-24  the common-interest community for the failure to pay assessments

7-25  levied against those units or fines imposed against units’ owners;

7-26  and

7-27          (8) Whether a study of the reserves of the association,

7-28  conducted pursuant to NRS 116.31152, exists and, if so, the date

7-29  on which it was completed.

7-30      Sec. 23.  NRS 116.1117 is hereby amended to read as follows:

7-31      116.1117  1.  There is hereby created the Account for [the

7-32  Ombudsman for Owners in] Common-Interest Communities in

7-33  the State General Fund. The Account must be administered by the

7-34  Administrator.

7-35      2.  The fees collected pursuant to NRS 116.31155 must be

7-36  credited to the Account.

7-37      3.  The interest and income earned on the money in the

7-38  Account, after deducting any applicable charges, must be credited to

7-39  the Account.

7-40      4.  The money in the Account must be used solely to [defray] :

7-41      (a) Defray the costs and expenses of administering the Office of

7-42  the Ombudsman for Owners in Common-Interest Communities ;

7-43  and [for the payment of fees for a mediator or an arbitrator pursuant

7-44  to NRS 38.330.]

8-1  (b) Subsidize proceedings for mediation and arbitration

8-2  conducted pursuant to NRS 38.300 to 38.360, inclusive, in

8-3  accordance with the regulations adopted by the Division.

8-4  Sec. 24.  NRS 116.1201 is hereby amended to read as follows:

8-5  116.1201  1.  Except as otherwise provided in this section and

8-6  NRS 116.1203, this chapter applies to all common-interest

8-7  communities created within this state.

8-8  2.  This chapter does not apply to:

8-9  (a) Associations created for the limited purpose of maintaining:

8-10          (1) The landscape of the common elements of a common-

8-11  interest community;

8-12          (2) Facilities for flood control; or

8-13          (3) A rural agricultural residential common-interest

8-14  community.

8-15      (b) A planned community in which all units are restricted

8-16  exclusively to nonresidential use unless the declaration provides that

8-17  the chapter does apply to that planned community. This chapter

8-18  applies to a planned community containing both units that are

8-19  restricted exclusively to nonresidential use and other units that are

8-20  not so restricted, only if the declaration so provides or the real estate

8-21  comprising the units that may be used for residential purposes

8-22  would be a planned community in the absence of the units that may

8-23  not be used for residential purposes.

8-24      (c) Common-interest communities or units located outside of

8-25  this state, but the provisions of NRS 116.4102 to 116.4108,

8-26  inclusive, apply to all contracts for the disposition thereof signed in

8-27  this state by any party unless exempt under subsection 2 of

8-28  NRS 116.4101.

8-29      (d) Except as otherwise provided in this chapter, time shares

8-30  governed by the provisions of chapter 119A of NRS.

8-31      3.  The provisions of this chapter do not:

8-32      (a) Prohibit a common-interest community created before

8-33  January 1, 1992, from providing for separate classes of voting for

8-34  the units’ owners of the association;

8-35      (b) Require a common-interest community created before

8-36  January 1, 1992, to comply with the provisions of NRS 116.2101 to

8-37  116.2122, inclusive; or

8-38      (c) Invalidate any assessments that were imposed on or before

8-39  October 1, 1999, by a common-interest community created before

8-40  January 1, 1992 . [; or

8-41      (d) Prohibit a common-interest community created before

8-42  January 1, 1992, from providing for a representative form of

8-43  government.]

8-44      4.  The provisions of chapters 117 and 278A of NRS do not

8-45  apply to common-interest communities.

9-1  5.  For the purposes of this section, the Administrator shall

9-2  establish, by regulation, the criteria for determining whether an

9-3  association is created for the limited purpose of maintaining the

9-4  landscape of the common elements of a common-interest

9-5  community, maintaining facilities for flood control or maintaining a

9-6  rural agricultural residential common-interest community.

9-7  Sec. 25.  NRS 116.1206 is hereby amended to read as follows:

9-8  116.1206  1.  Any provision contained in a declaration, bylaw

9-9  or other governing document of a common-interest community

9-10  [created before January 1, 1992,] in effect on October 1, 2003, that

9-11  does not conform to the provisions of this chapter [shall] :

9-12      (a) Shall be deemed to conform with those provisions by

9-13  operation of law [, and any such declaration, bylaw or other

9-14  governing document is not required to be amended to conform to

9-15  those provisions.] ; and

9-16      (b) May be changed to conform to those provisions and may be

9-17  so changed by a vote of the executive board of the association, or a

9-18  declarant if the governing document permits a declarant to make

9-19  changes to the governing document, without compliance with the

9-20  procedural requirements generally applicable to the adoption of

9-21  an amendment to the declaration, bylaws or other governing

9-22  document.

9-23      2.  In the case of amendments to the declaration, bylaws or plats

9-24  and plans of any common-interest community created before

9-25  January 1, 1992:

9-26      (a) If the result accomplished by the amendment was permitted

9-27  by law before January 1, 1992, the amendment may be made either

9-28  in accordance with that law, in which case that law applies to that

9-29  amendment, or it may be made under this chapter; and

9-30      (b) If the result accomplished by the amendment is permitted by

9-31  this chapter, and was not permitted by law before January 1, 1992,

9-32  the amendment may be made under this chapter.

9-33      3.  An amendment to the declaration, bylaws or plats and plans

9-34  authorized by this section to be made under this chapter must be

9-35  adopted in conformity with the applicable provisions of chapter 117

9-36  or 278A of NRS and with the procedures and requirements specified

9-37  by those instruments. If an amendment grants to any person any

9-38  rights, powers or privileges permitted by this chapter, all correlative

9-39  obligations, liabilities and restrictions in this chapter also apply to

9-40  that person.

9-41      Sec. 26.  NRS 116.2103 is hereby amended to read as follows:

9-42      116.2103  1.  [All provisions of the declaration and bylaws are

9-43  severable.] The inclusion in a governing document of an

9-44  association of a provision that violates any provision of this

9-45  chapter does not render any other provision of the governing

10-1  document invalid or otherwise unenforceable if such other

10-2  provisions can be given effect in accordance with their original

10-3  intent and the provisions of this chapter.

10-4      2.  The rule against perpetuities and NRS 111.103 to 111.1039,

10-5  inclusive, do not apply to defeat any provision of the declaration,

10-6  bylaws, rules or regulations adopted pursuant to NRS 116.3102.

10-7      3.  In the event of a conflict between the provisions of the

10-8  declaration and the bylaws, the declaration prevails except to the

10-9  extent the declaration is inconsistent with this chapter.

10-10     4.  Title to a unit and common elements is not rendered

10-11  unmarketable or otherwise affected by reason of an insubstantial

10-12  failure of the declaration to comply with this chapter. Whether a

10-13  substantial failure impairs marketability is not affected by this

10-14  chapter.

10-15     Sec. 27.  NRS 116.2105 is hereby amended to read as follows:

10-16     116.2105  1.  The declaration must contain:

10-17     (a) The names of the common-interest community and the

10-18  association and a statement that the common-interest community is

10-19  either a condominium, cooperative or planned community;

10-20     (b) The name of every county in which any part of the common-

10-21  interest community is situated;

10-22     (c) A sufficient description of the real estate included in the

10-23  common-interest community;

10-24     (d) A statement of the maximum number of units that the

10-25  declarant reserves the right to create;

10-26     (e) In a condominium or planned community, a description of

10-27  the boundaries of each unit created by the declaration, including the

10-28  unit’s identifying number or, in a cooperative, a description, which

10-29  may be by plats or plans, of each unit created by the declaration,

10-30  including the unit’s identifying number, its size or number of rooms,

10-31  and its location within a building if it is within a building containing

10-32  more than one unit;

10-33     (f) A description of any limited common elements, other than

10-34  those specified in subsections 2 and 4 of NRS 116.2102, as provided

10-35  in paragraph (g) of subsection 2 of NRS 116.2109 and, in a planned

10-36  community, any real estate that is or must become common

10-37  elements;

10-38     (g) A description of any real estate, except real estate subject to

10-39  developmental rights, that may be allocated subsequently as limited

10-40  common elements, other than limited common elements specified in

10-41  subsections 2 and 4 of NRS 116.2102, together with a statement that

10-42  they may be so allocated;

10-43     (h) A description of any developmental rights [(NRS

10-44  116.11034)] and other special declarant’s rights [(NRS

10-45  116.110385)] reserved by the declarant, together with a legally

11-1  sufficient description of the real estate to which each of those rights

11-2  applies, and a time within which each of those rights must be

11-3  exercised;

11-4      (i) If any developmental right may be exercised with respect to

11-5  different parcels of real estate at different times, a statement to that

11-6  effect together with:

11-7          (1) Either a statement fixing the boundaries of those portions

11-8  and regulating the order in which those portions may be subjected to

11-9  the exercise of each developmental right or a statement that no

11-10  assurances are made in those regards; and

11-11         (2) A statement whether, if any developmental right is

11-12  exercised in any portion of the real estate subject to that

11-13  developmental right, that developmental right must be exercised in

11-14  all or in any other portion of the remainder of that real estate;

11-15     (j) Any other conditions or limitations under which the rights

11-16  described in paragraph (h) may be exercised or will lapse;

11-17     (k) An allocation to each unit of the allocated interests in the

11-18  manner described in NRS 116.2107 [;] and a statement of whether

11-19  voting by delegates is required or permitted pursuant to section 15

11-20  of this act;

11-21     (l) Any restrictions:

11-22         (1) On use, occupancy and alienation of the units; and

11-23         (2) On the amount for which a unit may be sold or on the

11-24  amount that may be received by a unit’s owner on sale,

11-25  condemnation or casualty to the unit or to the common-interest

11-26  community, or on termination of the common-interest community;

11-27     (m) The file number and book or other information to show

11-28  where easements and licenses are recorded appurtenant to or

11-29  included in the common-interest community or to which any portion

11-30  of the common-interest community is or may become subject by

11-31  virtue of a reservation in the declaration; and

11-32     (n) All matters required by NRS 116.2106 to 116.2109,

11-33  inclusive, 116.2115 , [and] 116.2116 and 116.31032.

11-34     2.  The declaration may contain any other matters the declarant

11-35  considers appropriate.

11-36     Sec. 28.  NRS 116.2111 is hereby amended to read as follows:

11-37     116.2111  [Subject]

11-38     1.  Except as otherwise provided in this section and subject to

11-39  the provisions of the declaration and other provisions of law, a

11-40  unit’s owner:

11-41     [1.] (a) May make any improvements or alterations to his unit

11-42  that do not impair the structural integrity or mechanical systems or

11-43  lessen the support of any portion of the common-interest

11-44  community;

12-1      [2.] (b) May not change the appearance of the common

12-2  elements, or the exterior appearance of a unit or any other portion of

12-3  the common-interest community, without permission of the

12-4  association; and

12-5      [3.] (c) After acquiring an adjoining unit or an adjoining part of

12-6  an adjoining unit, may remove or alter any intervening partition or

12-7  create apertures therein, even if the partition in whole or in part is a

12-8  common element, if those acts do not impair the structural integrity

12-9  or mechanical systems or lessen the support of any portion of the

12-10  common-interest community. Removal of partitions or creation of

12-11  apertures under this [subsection] paragraph is not an alteration of

12-12  boundaries.

12-13     2.  An association may not:

12-14     (a) Require the removal of any structure, fixture or other

12-15  improvement made to a unit if it was approved by the association

12-16  in writing before it was installed or constructed in accordance with

12-17  procedures set forth in the governing documents of the

12-18  association.

12-19     (b) Unreasonably restrict, prohibit or otherwise impede the

12-20  lawful rights of a unit’s owner to have reasonable access to his

12-21  unit.

12-22     (c) Prohibit or unreasonably restrict or withhold approval for

12-23  a unit’s owner to include or add in or to a unit:

12-24         (1) An apparatus required for the use of solar energy;

12-25         (2) Improvements such as ramps, railings or elevators that

12-26  are necessary or desirable to increase the unit’s owner’s access to

12-27  his unit if an occupant of the unit is disabled; or

12-28         (3) Shutters or additional locks that are desirable to make a

12-29  unit’s owner feel safe in his unit.

12-30     3.  If the improvement or alteration is visible from any other

12-31  portion of the common-interest community, any device or other

12-32  improvement included or added in or to a unit pursuant to

12-33  paragraph (b) or (c) of subsection 2 must be added or installed in

12-34  accordance with the procedures set forth in the governing

12-35  documents of the association and must be selected or designed to

12-36  the maximum extent practicable to be compatible with the style of

12-37  the common-interest community.

12-38     Sec. 29. NRS 116.212 is hereby amended to read as follows:

12-39     116.212  1.  If the declaration provides that any of the powers

12-40  described in NRS 116.3102 are to be exercised by or may be

12-41  delegated to a profit or nonprofit corporation that exercises those or

12-42  other powers on behalf of one or more common-interest

12-43  communities or for the benefit of the units’ owners of one or more

12-44  common-interest communities, or on behalf of a common-interest

12-45  community and a time-share plan created pursuant to chapter 119A

13-1  of NRS, all provisions of this chapter applicable to unit-owners’

13-2  associations apply to any such corporation, except as modified by

13-3  this section.

13-4      2.  Unless it is acting in the capacity of an association described

13-5  in NRS 116.3101, a master association may exercise the powers set

13-6  forth in paragraph (b) of subsection 1 of NRS 116.3102 only to the

13-7  extent expressly permitted in:

13-8      (a) The declarations of common-interest communities which are

13-9  part of the master association or expressly described in the

13-10  delegations of power from those common-interest communities to

13-11  the master association; or

13-12     (b) The declaration of the common-interest community which is

13-13  a part of the master association and the time-share instrument

13-14  creating the time-share plan governed by the master association.

13-15     3.  If the declaration of any common-interest community

13-16  provides that the executive board may delegate certain powers to a

13-17  master association, the members of the executive board have no

13-18  liability for the acts or omissions of the master association with

13-19  respect to those powers following delegation.

13-20     4.  The rights and responsibilities of units’ owners with respect

13-21  to the unit-owners’ association set forth in NRS 116.3103 to

13-22  116.31038, inclusive, 116.3108, 116.3109, 116.311 and 116.3112

13-23  and section 15 of this act apply in the conduct of the affairs of a

13-24  master association only to persons who elect the board of a master

13-25  association, whether or not those persons are otherwise units’

13-26  owners within the meaning of this chapter.

13-27     5.  Even if a master association is also an association described

13-28  in NRS 116.3101, the certificate of incorporation or other

13-29  instrument creating the master association and the declaration of

13-30  each common-interest community, the powers of which are assigned

13-31  by the declaration or delegated to the master association, may

13-32  provide that the executive board of the master association must be

13-33  elected after the period of the declarant’s control in any of the

13-34  following ways:

13-35     (a) All units’ owners of all common-interest communities

13-36  subject to the master association may elect all members of the

13-37  master association’s executive board.

13-38     (b) All members of the executive boards of all common-interest

13-39  communities subject to the master association may elect all

13-40  members of the master association’s executive board.

13-41     (c) All units’ owners of each common-interest community

13-42  subject to the master association may elect specified members of the

13-43  master association’s executive board.

14-1      (d) All members of the executive board of each common-interest

14-2  community subject to the master association may elect specified

14-3  members of the master association’s executive board.

14-4      Sec. 30.  NRS 116.3102 is hereby amended to read as follows:

14-5      116.3102  1.  Except as otherwise provided in subsection 2,

14-6  and subject to the provisions of the declaration, the association may:

14-7      (a) Adopt and amend bylaws, rules and regulations;

14-8      (b) Adopt and amend budgets for revenues, expenditures and

14-9  reserves and collect assessments for common expenses from units’

14-10  owners;

14-11     (c) Hire and discharge managing agents and other employees,

14-12  agents and independent contractors;

14-13     (d) Institute, defend or intervene in litigation or administrative

14-14  proceedings in its own name on behalf of itself or two or more units’

14-15  owners on matters affecting the common-interest community;

14-16     (e) Make contracts and incur liabilities;

14-17     (f) Regulate the use, maintenance, repair, replacement and

14-18  modification of common elements;

14-19     (g) Cause additional improvements to be made as a part of the

14-20  common elements;

14-21     (h) Acquire, hold, encumber and convey in its own name any

14-22  right, title or interest to real estate or personal property, but:

14-23         (1) Common elements in a condominium or planned

14-24  community may be conveyed or subjected to a security interest only

14-25  pursuant to NRS 116.3112; and

14-26         (2) Part of a cooperative may be conveyed, or all or part of a

14-27  cooperative may be subjected to a security interest, only pursuant to

14-28  NRS 116.3112;

14-29     (i) Grant easements, leases, licenses and concessions through or

14-30  over the common elements;

14-31     (j) Impose and receive any payments, fees or charges for the use,

14-32  rental or operation of the common elements, other than limited

14-33  common elements described in subsections 2 and 4 of NRS

14-34  116.2102, and for services provided to units’ owners;

14-35     (k) Impose charges for late payment of assessments[and, except

14-36  as otherwise provided in NRS 116.31031, after notice and an

14-37  opportunity to be heard, levy] ;

14-38     (l) Impose construction penalties pursuant to the provisions of

14-39  section 15 of this act;

14-40     (m) Impose reasonable fines for violations of the [declaration,

14-41  bylaws, rules and regulations] governing documents of the

14-42  association[;

14-43     (l)] only if the association complies with the requirements of

14-44  NRS 116.31031;

15-1      (n) Impose reasonable charges for the preparation and

15-2  recordation of amendments to the declaration, the information

15-3  required by NRS 116.4109 or statements of unpaid assessments;

15-4      [(m)] (o) Provide for the indemnification of its officers and

15-5  executive board and maintain directors’ and officers’ liability

15-6  insurance;

15-7      [(n)] (p) Assign its right to future income, including the right to

15-8  receive assessments for common expenses, but only to the extent the

15-9  declaration expressly so provides;

15-10     [(o)] (q) Exercise any other powers conferred by the declaration

15-11  or bylaws;

15-12     [(p)] (r) Exercise all other powers that may be exercised in this

15-13  state by legal entities of the same type as the association;

15-14     [(q)] (s) Direct the removal of vehicles improperly parked on

15-15  property owned or leased by the association, pursuant to NRS

15-16  487.038; and

15-17     [(r)] (t) Exercise any other powers necessary and proper for the

15-18  governance and operation of the association.

15-19     2.  The declaration may not impose limitations on the power of

15-20  the association to deal with the declarant which are more restrictive

15-21  than the limitations imposed on the power of the association to deal

15-22  with other persons.

15-23     Sec. 31.  NRS 116.31031 is hereby amended to read as

15-24  follows:

15-25     116.31031  1.  [If] Except as otherwise provided in this

15-26  section, if a unit’s owner[,] or a tenant or guest of a unit’s owner[,

15-27  does not comply with] violates a provision of the governing

15-28  documents of an association, the executive board of the association

15-29  may, if the governing documents so provide:

15-30     (a) Prohibit, for a reasonable time, the unit’s owner[,] or the

15-31  tenant or guest of the unit’s owner[,] from:

15-32         (1) Voting on matters related to the common-interest

15-33  community.

15-34         (2) Usingthe common elements. The provisions of this

15-35  subparagraph do not prohibit the unit’s owner[,] or the tenant or

15-36  guest of the unit’s owner[,] from using any vehicular or pedestrian

15-37  ingress or egress to go to or from the unit, including any area used

15-38  for parking.

15-39     (b) Require the unit’s owner[,] or the tenant or guest of the

15-40  unit’s owner[,] to pay a fine for each [failure to comply that does

15-41  not threaten the health and welfare of the common-interest

15-42  community.] violation. The fine must be commensurate with the

15-43  severity of the violation . [, but] If the violation does not threaten

15-44  the health, safety or welfare of the common-interest community,

16-1  the fine must not exceed $100 for each violation . [or a total amount

16-2  of $500, whichever is less.]

16-3      2.  The executive board may not require the unit’s owner or

16-4  the tenant or guest of the unit’s owner to pay a fine for a violation

16-5  of the governing documents unless:

16-6      (a) Not less than 30 days before the alleged violation, the

16-7  unit’s owner or the tenant or guest of the unit’s owner had been

16-8  provided with written notice of the applicable provisions of the

16-9  governing documents that form the basis of the violation;

16-10     (b) The association provided written notice by regular mail to

16-11  the unit’s owner that:

16-12         (1) Sets forth the alleged violation, the provision of the

16-13  governing documents alleged to have been violated and any

16-14  required corrective action; and

16-15         (2) Includes a statement that informs the unit’s owner of

16-16  the opportunity to request a hearing on the alleged violation

16-17  before the imposition of any fine; and

16-18     (c) The unit’s owner was afforded a reasonable time to cure

16-19  the alleged violation before the imposition of any fine.

16-20     3.  A unit’s owner shall have a minimum of 10 days after the

16-21  date notice is received by the unit’s owner pursuant to paragraph

16-22  (b) of subsection 2 to request a hearing on an alleged violation.

16-23     4.  If a fine is imposed pursuant to subsection 1 and the

16-24  violation is not cured within 14 days or a longer period as may be

16-25  established by the executive board, the violation shall be deemed a

16-26  continuing violation. Thereafter, the executive board may impose an

16-27  additional fine for the violation for each 7-day period or portion

16-28  thereof that the violation is not cured [.] , but in no event may the

16-29  cumulative total amount of the additional fine exceed $1,000 per

16-30  calendar year for each continuing violation. Any additional fine

16-31  for each continuing violation may be imposed without notice and

16-32  an opportunity to be heard.

16-33     [3.  Except as otherwise provided in subsection 2, the

16-34  imposition of a fine pursuant to this section must comply with the

16-35  requirements of subsection 6 of NRS 116.31065.]

16-36     5.  The provisions of this section establish the minimum

16-37  procedural requirements that the executive board must follow

16-38  before it may require the unit’s owner or the tenant or guest of the

16-39  unit’s owner to pay a fine for a violation or a continuing violation.

16-40  The provisions of this section do not preempt any provisions of the

16-41  governing documents that provide greater procedural protections

16-42  to the unit’s owner or the tenant or guest of the unit’s owner.

 

 

17-1      Sec. 32.  NRS 116.31034 is hereby amended to read as

17-2  follows:

17-3      116.31034  1.  Except as otherwise provided in subsection 5 of

17-4  NRS 116.212, not later than the termination of any period of

17-5  declarant’s control, the units’ owners shall elect an executive board

17-6  of at least three members, at least a majority of whom must be units’

17-7  owners. The executive board shall elect the officers. The members

17-8  and officers of the executive board shall take office upon election.

17-9      2.  The term of office of a member of the executive board may

17-10  not exceed 2 years. A member of the executive board may be

17-11  elected to succeed himself. The governing documents of the

17-12  association must [set] :

17-13     (a) Set forth the month during which elections for the members

17-14  of the executive board must be held after the termination of any

17-15  period of the declarant’s control.

17-16     (b) Provide for terms of office that are staggered in such a

17-17  manner that, to the extent possible, an equal number of members

17-18  of the executive board are elected at each election. The provisions

17-19  of this paragraph do not apply to:

17-20         (1) Members of the executive board appointed by the

17-21  declarant; and

17-22         (2) Members of the executive board who serve a term of 1

17-23  year or less.

17-24     3.  Not less than 30 days before the preparation of a ballot for

17-25  the election of members of the executive board, the secretary or

17-26  other officer specified in the bylaws of the association shall cause

17-27  notice to be given to each unit’s owner of his eligibility to serve as a

17-28  member of the executive board. Each unit’s owner who is qualified

17-29  to serve as a member of the executive board may have his name

17-30  placed on the ballot along with the names of the nominees selected

17-31  by the members of the executive board or a nominating committee

17-32  established by the association.

17-33     4.  A person may not be an officer or member of the executive

17-34  board if he or any member of his immediate family engages in the

17-35  management of the common-interest community.

17-36     5.  An officer, employee, agent or director of a corporate owner

17-37  of a unit, a trustee or designated beneficiary of a trust that owns a

17-38  unit, a partner of a partnership that owns a unit, a member or

17-39  manager of a limited-liability company that owns a unit, and a

17-40  fiduciary of an estate that owns a unit may be an officer or member

17-41  of the executive board. In all events where the person serving or

17-42  offering to serve as an officer or member of the executive board is

17-43  not the record owner, he shall file proof in the records of the

17-44  association that:

18-1      (a) He is associated with the corporate owner, trust, partnership ,

18-2  limited-liability company or estate as required by this subsection;

18-3  and

18-4      (b) Identifies the unit or units owned by the corporate owner,

18-5  trust, partnership , limited-liability company or estate.

18-6      [5.] 6.  The election of any member of the executive board

18-7  must be conducted by secret written ballot[. The] unless the

18-8  declaration of the association provides that voting rights may be

18-9  exercised by delegates or representatives as set forth in section 15

18-10  of this act. If the election is conducted by secret written ballot, the

18-11  secretary or other officer specified in the bylaws of the association

18-12  shall cause to be sent prepaid by United States mail to the mailing

18-13  address of each unit within the common-interest community or to

18-14  any other mailing address designated in writing by the unit’s owner,

18-15  a secret ballot and a return envelope.

18-16     [6.] 7. Each member of the executive board shall, within [30]

18-17  90 days after his appointment or election, certify in writing to the

18-18  association, on a form prescribed by the Administrator, that he has

18-19  read and understands the governing documents of the association

18-20  and the provisions of this chapter to the best of his ability. The

18-21  Administrator may require the association to submit a copy of the

18-22  certification of each member of the executive board of that

18-23  association at the time the association registers with the

18-24  Ombudsman for Owners in Common-Interest Communities

18-25  pursuant to the provisions of NRS 116.31158.

18-26     Sec. 33.  NRS 116.31036 is hereby amended to read as

18-27  follows:

18-28     116.31036  1.  Notwithstanding any provision of the

18-29  declaration or bylaws to the contrary, the units’ owners, by a two-

18-30  thirds vote of all persons [present and] entitled to vote at any

18-31  meeting of the units’ owners at which a quorum is present, may

18-32  remove any member of the executive board with or without cause,

18-33  other than a member appointed by the declarant.

18-34     2.  The removal of any member of the executive board must be

18-35  conducted by secret written ballot or by a delegate or

18-36  representative when authorized pursuant to section 15 of this act.

18-37  If the removal of a member of the executive board is conducted by

18-38  secret written ballot, the secretary or other officer specified in the

18-39  bylaws of the association shall cause to be sent prepaid by United

18-40  States mail to the mailing address of each unit within the

18-41  common-interest community or to any other mailing address

18-42  designated in writing by the unit’s owner, a secret ballot and a

18-43  return envelope.

18-44     3.  If a member of an executive board is sued for liability for

18-45  actions undertaken in his role as a member of the board, the

19-1  association shall indemnify him for his losses or claims[,] and

19-2  undertake all costs of defense, unless it is proven that he acted with

19-3  willful or wanton misfeasance or with gross negligence. After such

19-4  proof , the association is no longer liable for the cost of defense[,]

19-5  and may recover costs already expended from the member of the

19-6  executive board who so acted. Members of the executive board are

19-7  not personally liable to the victims of crimes occurring on the

19-8  property. Punitive damages may not be recovered against the

19-9  association, but may be recovered from persons whose activity gave

19-10  rise to the damages.

19-11     Sec. 34.  NRS 116.3106 is hereby amended to read as follows:

19-12     116.3106  1.  The bylaws of the association must provide:

19-13     (a) The number of members of the executive board and the titles

19-14  of the officers of the association;

19-15     (b) For election by the executive board of a president, treasurer,

19-16  secretary and any other officers of the association the bylaws

19-17  specify;

19-18     (c) The qualifications, powers and duties, terms of office and

19-19  manner of electing and removing officers of the association and

19-20  members of the executive board and filling vacancies;

19-21     (d) Which, if any, of its powers the executive board or officers

19-22  may delegate to other persons or to a [managing agent;] person

19-23  engaged in the management of a common-interest community;

19-24     (e) Which of its officers may prepare, execute, certify and

19-25  record amendments to the declaration on behalf of the association;

19-26     (f) Procedural rules for conducting meetings of the association;

19-27  [and]

19-28     (g) A method for amending the bylaws [.] ; and

19-29     (h) Procedural rules for conducting elections.

19-30     2.  Except as otherwise provided in the declaration, the bylaws

19-31  may provide for any other matters the association deems necessary

19-32  and appropriate.

19-33     3.  The bylaws must be written in plain English.

19-34     Sec. 35.  NRS 116.31065 is hereby amended to read as

19-35  follows:

19-36     116.31065  The rules adopted by an association:

19-37     1.  Must be reasonably related to the purpose for which they are

19-38  adopted.

19-39     2.  Must be sufficiently explicit in their prohibition, direction or

19-40  limitation to inform a unit’s owner[,] or a tenant or guest of a unit’s

19-41  owner[,] of any action or omission required for compliance.

19-42     3.  Must not be adopted to evade any obligation of the

19-43  association.

19-44     4.  Must be consistent with the governing documents of the

19-45  association and must not arbitrarily restrict conduct or require the

20-1  construction of any capital improvement by a unit’s owner that is

20-2  not required by the governing documents of the association.

20-3      5.  Must be uniformly enforced under the same or similar

20-4  circumstances against all units’ owners. [Any rule that is not so

20-5  uniformly enforced may not be enforced against any unit’s owner.]

20-6      6.  May be enforced by the [assessment] association through

20-7  the imposition of a fine only if [:

20-8      (a) The person alleged to have violated the rule has received

20-9  notice of the alleged violation that informs him of his opportunity to

20-10  request a hearing on the alleged violation.

20-11     (b) At least 30 days before the alleged violation, the person

20-12  alleged to have violated the rule was given written notice of the rule

20-13  or any amendment to the rule .] the association complies with the

20-14  requirements set forth in NRS 116.31031.

20-15     Sec. 36.  NRS 116.3108 is hereby amended to read as follows:

20-16     116.3108  1.  A meeting of the units’ owners of an association

20-17  must be held at least once each year. If the governing documents of

20-18  a common-interest community do not designate an annual meeting

20-19  date of the units’ owners, a meeting of the units’ owners must be

20-20  held 1 year after the date of the last meeting of the units’ owners. If

20-21  the units’ owners have not held a meeting for 1 year, a meeting of

20-22  the units’ owners must be held on the following March 1. Special

20-23  meetings of the units’ owners of an association may be called by the

20-24  president, a majority of the executive board or by units’ owners

20-25  having 10 percent, or any lower percentage specified in the bylaws,

20-26  of the votes in the association.

20-27     2.  Not less than 10 nor more than 60 days in advance of any

20-28  meeting of the units’ owners of an association, the secretary or other

20-29  officer specified in the bylaws shall cause notice of the meeting to

20-30  be hand-delivered, sent prepaid by United States mail to the mailing

20-31  address of each unit or to any other mailing address designated in

20-32  writing by the unit’s owner or, if the association offers to send

20-33  notice by electronic mail, sent by electronic mail at the request of

20-34  the unit’s owner to an electronic mail address designated in writing

20-35  by the unit’s owner. The notice of the meeting must state the time

20-36  and place of the meeting and include a copy of the agenda for the

20-37  meeting. The notice must include notification of the right of a unit’s

20-38  owner to:

20-39     (a) Have a copy of the minutes or a summary of the minutes of

20-40  the meeting distributed to him upon request and, if required by the

20-41  executive board, upon payment to the association of the cost of

20-42  making the distribution.

20-43     (b) Speak to the association or executive board, unless the

20-44  executive board is meeting in executive session.

21-1      3.  The agenda for a meeting of the units’ owners must consist

21-2  of:

21-3      (a) A clear and complete statement of the topics scheduled to be

21-4  considered during the meeting, including, without limitation, any

21-5  proposed amendment to the declaration or bylaws, any fees or

21-6  assessments to be imposed or increased by the association, any

21-7  budgetary changes and any proposal to remove an officer or

21-8  member of the executive board.

21-9      (b) A list describing the items on which action may be taken and

21-10  clearly denoting that action may be taken on those items. In an

21-11  emergency, the units’ owners may take action on an item which is

21-12  not listed on the agenda as an item on which action may be taken.

21-13     (c) A period devoted to comments by units’ owners and

21-14  discussion of those comments. Except in emergencies, no action

21-15  may be taken upon a matter raised under this item of the agenda

21-16  until the matter itself has been specifically included on an agenda as

21-17  an item upon which action may be taken pursuant to paragraph (b).

21-18     4.  If the association adopts a policy imposing a fine on a unit’s

21-19  owner or a tenant or guest of a unit’s owner for [the] a violation or

21-20  continuing violation of the [declaration, bylaws or other rules

21-21  established by] governing documents of the association, the

21-22  secretary or other officer specified in the bylaws shall prepare and

21-23  cause to be hand-delivered or sent prepaid by United States mail to

21-24  the mailing address of each unit or to any other mailing address

21-25  designated in writing by the unit’s owner, a schedule of the fines

21-26  that may be imposed for those violations[.]

21-27   or continuing violations.

21-28     5.  Not more than 30 days after any meeting of the units’

21-29  owners, the secretary or other officer specified in the bylaws shall

21-30  cause the minutes or a summary of the minutes of the meeting to be

21-31  made available to the units’ owners. A copy of the minutes or a

21-32  summary of the minutes must be provided to any unit’s owner who

21-33  pays the association the cost of providing the copy to him.

21-34     6.  As used in this section, “emergency” means any occurrence

21-35  or combination of occurrences that:

21-36     (a) Could not have been reasonably foreseen;

21-37     (b) Affects the health, welfare and safety of the units’ owners of

21-38  the association;

21-39     (c) Requires the immediate attention of, and possible action by,

21-40  the executive board; and

21-41     (d) Makes it impracticable to comply with the provisions of

21-42  subsection 2 or 3.

 

 

22-1      Sec. 37.  NRS 116.31083 is hereby amended to read as

22-2  follows:

22-3      116.31083  1.  A meeting of the executive board of an

22-4  association must be held at least once every 90 days.

22-5      2.  Except in an emergency or unless the bylaws of an

22-6  association require a longer period of notice, the secretary or other

22-7  officer specified in the bylaws of the association shall, not less than

22-8  10 days before the date of a meeting of the executive board, cause

22-9  notice of the meeting to be given to the units’ owners. Such notice

22-10  must be:

22-11     (a) Sent prepaid by United States mail to the mailing address of

22-12  each unit within the common-interest community or to any other

22-13  mailing address designated in writing by the unit’s owner;

22-14     (b) If the association offers to send notice by electronic mail,

22-15  sent by electronic mail at the request of the unit’s owner to an

22-16  electronic mail address designated in writing by the unit’s owner; or

22-17     (c) Published in a newsletter or other similar publication that is

22-18  circulated to each unit’s owner.

22-19     3.  In an emergency, the secretary or other officer specified in

22-20  the bylaws of the association shall, if practicable, cause notice of the

22-21  meeting to be sent prepaid by United States mail to the mailing

22-22  address of each unit within the common-interest community. If

22-23  delivery of the notice in this manner is impracticable, the notice

22-24  must be hand-delivered to each unit within the common-interest

22-25  community or posted in a prominent place or places within the

22-26  common elements of the association.

22-27     4.  The notice of a meeting of the executive board of an

22-28  association must state the time and place of the meeting and include

22-29  a copy of the agenda for the meeting or the date on which and the

22-30  locations where copies of the agenda may be conveniently obtained

22-31  by the units’ owners of the association. The notice must include

22-32  notification of the right of a unit’s owner to:

22-33     (a) Have a copy of the minutes or a summary of the minutes of

22-34  the meeting distributed to him upon request and, if required by the

22-35  executive board, upon payment to the association of the cost of

22-36  making the distribution.

22-37     (b) Speak to the association or executive board, unless the

22-38  executive board is meeting in executive session.

22-39     5.  The agenda of the meeting of the executive board of an

22-40  association must comply with the provisions of subsection 3 of NRS

22-41  116.3108. The period required to be devoted to comments by units’

22-42  owners and discussion of those comments must be scheduled for the

22-43  beginning of each meeting. In an emergency, the executive board

22-44  may take action on an item which is not listed on the agenda as an

22-45  item on which action may be taken.

23-1      6.  At least once every 90 days, unless the declaration or bylaws

23-2  of the association impose more stringent standards, the executive

23-3  board shall review at one of its meetings:

23-4      (a) A current reconciliation of the operating account of the

23-5  association;

23-6      (b) A current reconciliation of the reserve account of the

23-7  association;

23-8      (c) The actual revenues and expenses for the reserve account,

23-9  compared to the budget for that account for the current year;

23-10     (d) The latest account statements prepared by the financial

23-11  institutions in which the accounts of the association are maintained;

23-12     (e) An income and expense statement, prepared on at least a

23-13  quarterly basis, for the operating and reserve accounts of the

23-14  association; and

23-15     (f) The current status of any civil action or claim submitted to

23-16  arbitration or mediation in which the association is a party.

23-17     7.  [The] Except as otherwise provided in the subsection, the

23-18  minutes of a meeting of the executive board of an association must

23-19  [be] :

23-20     (a) Include:

23-21         (1) The date, time and place of the meeting;

23-22         (2) Those members of the executive board who were present

23-23  and those members who were absent;

23-24         (3) The substance of all matters proposed, discussed or

23-25  decided and, at the request of any member of the executive board,

23-26  a record of each member’s vote on any matter decided by vote; and

23-27         (4) The substance of remarks made by any unit’s owner

23-28  who addresses the executive board if he requests that the minutes

23-29  reflect his remarks or, if he has prepared written remarks, a copy

23-30  of his prepared remarks if he submits a copy for inclusion;

23-31     (b) Be maintained by the association until the common-interest

23-32  community is terminated; and

23-33     (c) Be made available to the units’ owners in accordance with

23-34  the provisions of subsection 5 of NRS 116.3108.

23-35  The executive board of an association may establish reasonable

23-36  limitations on materials, remarks or other information to be

23-37  included in the minutes of its meetings.

23-38     8.  A unit’s owner may record on audiotape or any other

23-39  means of sound reproduction a meeting of the executive board,

23-40  unless the board is meeting in executive session, if the unit’s

23-41  owner, before recording the meeting, provides notice of his intent

23-42  to record the meeting:

23-43     (a) In writing, to the president or the secretary of the

23-44  association at least 24 hours before the start of the meeting; and

24-1      (b) To the other units’ owners in attendance at the meeting

24-2  before beginning the recording of the meeting.

24-3      9.  As used in this section, “emergency” means any occurrence

24-4  or combination of occurrences that:

24-5      (a) Could not have been reasonably foreseen;

24-6      (b) Affects the health, welfare and safety of the units’ owners of

24-7  the association;

24-8      (c) Requires the immediate attention of, and possible action by,

24-9  the executive board; and

24-10     (d) Makes it impracticable to comply with the provisions of

24-11  subsection 2 or 5.

24-12     Sec. 38.  NRS 116.31085 is hereby amended to read as

24-13  follows:

24-14     116.31085  1.  Except as otherwise provided in this section, a

24-15  unit’s owner may attend any meeting of the units’ owners of the

24-16  association or of the executive board and speak at any such meeting.

24-17  The executive board may establish reasonable limitations on the

24-18  time a unit’s owner may speak at such a meeting.

24-19     2.  [An] The executive board may meet in executive session to:

24-20     (a) Consult with the attorney for the association on matters

24-21  relating to proposed or pending litigation if the contents of the

24-22  discussion would otherwise be governed by the privilege set forth in

24-23  NRS 49.035 to 49.115, inclusive;

24-24     (b) Discuss [matters relating to personnel;] an employee of the

24-25  association, an employee of a community manager of the

24-26  common-interest community or an employee of an independent

24-27  contractor who is working for the association; or

24-28     (c) Discuss a violation or continuing violation of the governing

24-29  documents alleged to have been committed by a unit’s owner or a

24-30  tenant or guest of a unit’s owner, including, without limitation, the

24-31  failure to pay an assessment, except as otherwise provided in

24-32  subsection 3.

24-33     3.  An executive board shall meet in executive session to hold a

24-34  hearing on an alleged violation of the governing documents unless

24-35  the unit’s owner who allegedly committed the violation , or the

24-36  unit’s owner on behalf of the tenant or guest of the unit’s owner,

24-37  requests in writing that the hearing be conducted by the executive

24-38  board at an open meeting. The unit’s owner or the tenant or guest

24-39  of the unit’s owner who is alleged to have committed the violation

24-40  may attend the hearing or executive session and testify concerning

24-41  the alleged violation, but may be excluded by the executive board

24-42  from any other portion of the hearing[,] or executive session,

24-43  including, without limitation, the deliberations of the executive

24-44  board.

25-1      4.  Except as otherwise provided in this subsection, any matter

25-2  discussed in executive session must be generally noted in the

25-3  minutes of the meeting of the executive board. The executive board

25-4  shall maintain minutes of any decision made pursuant to subsection

25-5  3 and, upon request, provide a copy of the decision to the unit’s

25-6  owner or the tenant or guest of the unit’s owner who [was the

25-7  subject of] requested the hearing or to his designated representative.

25-8      5.  Except as otherwise provided in subsection 3, a unit’s owner

25-9  or a tenant or guest of the unit’s owner is not entitled to attend or

25-10  speak at a meeting of the executive board held in executive session.

25-11     Sec. 39.  NRS 116.3109 is hereby amended to read as follows:

25-12     116.3109  1.  Except as otherwise provided in this section and

25-13  unless the bylaws provide otherwise, a quorum is present throughout

25-14  any meeting of the association if persons entitled to cast 20 percent

25-15  of the votes that may be cast for election of the executive board are

25-16  present in person or by proxy at the beginning of the meeting.

25-17     2.  If the governing documents of an association provide for a

25-18  quorum at a meeting of the association that is greater than 20

25-19  percent of the votes that may be cast for election of the executive

25-20  board, and such a meeting for which proper notice has been given

25-21  cannot be held because a quorum is not present, the units’ owners

25-22  in attendance, either in person or by proxy in accordance with the

25-23  governing documents of the association, may adjourn the meeting

25-24  to a time that is not less than 48 hours or more than 30 days after

25-25  the date of the meeting. At the subsequent meeting, a quorum is

25-26  present if persons entitled to cast 20 percent of the votes that may

25-27  be cast for election of the executive board are present in person or

25-28  by proxy. If fewer units’ owners than that required by the quorum

25-29  requirement contained in the governing documents are present at

25-30  the subsequent meeting in person or by proxy in accordance with

25-31  the governing documents, only those matters included on the

25-32  agenda of the original meeting may be voted upon. The provisions

25-33  of this subsection do not change the number of votes required by a

25-34  governing document of an association for any particular action.

25-35     3.  Unless the bylaws specify a larger percentage, a quorum is

25-36  deemed present throughout any meeting of the executive board if

25-37  persons entitled to cast 50 percent of the votes on that board are

25-38  present at the beginning of the meeting.

25-39     [3.  For]

25-40     4.  If the election of a member of the executive board of an

25-41  association must be conducted by secret written ballot pursuant to

25-42  the provisions of subsection 6 of NRS 116.31034, then for the

25-43  purposes of [determining whether a quorum is present for the

25-44  election of] electing any member of the executive board[,] a

26-1  quorum is not required and only the secret written ballots that are

26-2  returned to the association may be counted.

26-3      Sec. 40.  NRS 116.311 is hereby amended to read as follows:

26-4      116.311  1.  If only one of several owners of a unit is present

26-5  at a meeting of the association, that owner is entitled to cast all the

26-6  votes allocated to that unit. If more than one of the owners are

26-7  present, the votes allocated to that unit may be cast only in

26-8  accordance with the agreement of a majority in interest of the

26-9  owners, unless the declaration expressly provides otherwise. There

26-10  is majority agreement if any one of the owners cast the votes

26-11  allocated to that unit without protest made promptly to the person

26-12  presiding over the meeting by any of the other owners of the unit.

26-13     2.  Except as otherwise provided in this section, votes allocated

26-14  to a unit may be cast pursuant to a proxy executed by a unit’s owner.

26-15  A unit’s owner may give a proxy only to a member of his immediate

26-16  family, a tenant of the unit’s owner who resides in the common-

26-17  interest community , [or] another unit’s owner who resides in the

26-18  common-interest community[.] or to a delegate or representative

26-19  when authorized pursuant to section 15 of this act. If a unit is

26-20  owned by more than one person, each owner of the unit may vote or

26-21  register protest to the casting of votes by the other owners of the unit

26-22  through an executed proxy. A unit’s owner may revoke a proxy

26-23  given pursuant to this section only by actual notice of revocation to

26-24  the person presiding over a meeting of the association.

26-25     3.  A proxy is void if:

26-26     (a) It is not dated or purports to be revocable without notice;

26-27     (b) It does not designate the votes that must be cast on behalf of

26-28  the unit’s owner who executed the proxy; or

26-29     (c) The holder of the proxy does not disclose at the beginning of

26-30  the meeting for which the proxy is executed the number of proxies

26-31  pursuant to which he will be casting votes . [and the voting

26-32  instructions received for each proxy.]

26-33     4.  A proxy terminates immediately after the conclusion of the

26-34  meeting for which it was executed.

26-35     5.  A vote may not be cast pursuant to a proxy for the election

26-36  or removal of a member of the executive board of an association[.

26-37     3.] unless the proxy is exercised through a delegate or

26-38  representative authorized pursuant to section 15 of this act.

26-39     6.  Only a vote cast in person, by secret ballot or by proxy, may

26-40  be counted.

26-41     [4.] 7.  If the declaration requires that votes on specified

26-42  matters affecting the common-interest community be cast by lessees

26-43  rather than units’ owners of leased units:

26-44     (a) The provisions of subsections 1 and 2 apply to lessees as if

26-45  they were units’ owners;

27-1      (b) Units’ owners who have leased their units to other persons

27-2  may not cast votes on those specified matters; and

27-3      (c) Lessees are entitled to notice of meetings, access to records,

27-4  and other rights respecting those matters as if they were units’

27-5  owners.

27-6  Units’ owners must also be given notice, in the manner provided in

27-7  NRS 116.3108, of all meetings at which lessees are entitled to vote.

27-8      [5.] 8.  No votes allocated to a unit owned by the association

27-9  may be cast.

27-10     [6.] 9.  Votes cast for the election or removal of a member of

27-11  the executive board of an association must be opened and counted

27-12  in public.

27-13     Sec. 41.  NRS 116.31139 is hereby amended to read as

27-14  follows:

27-15     116.31139  1.  An association may employ a [person engaged

27-16  in property management for the common-interest community.]

27-17  community manager.

27-18     2.  Except as otherwise provided in this section, a [person

27-19  engaged in property management for a common-interest

27-20  community] community manager must:

27-21     (a) Hold a permit to engage in property management that is

27-22  issued pursuant to the provisions of chapter 645 of NRS; or

27-23     (b) Hold a certificate issued by the [Real Estate Commission]

27-24  Division pursuant to subsection 3.

27-25     3.  The Real Estate Commission shall provide by regulation for

27-26  the issuance of certificates for [the management of common-interest

27-27  communities to persons] community managers who are not

27-28  otherwise authorized to engage in property management pursuant to

27-29  the provisions of chapter 645 of NRS. The regulations:

27-30     (a) Must establish the qualifications for the issuance of such a

27-31  certificate, including the education and experience required to obtain

27-32  such a certificate;

27-33     (b) May require applicants to pass an examination in order to

27-34  obtain a certificate;

27-35     (c) Must establish standards of practice for [persons engaged in

27-36  property management for a common-interest community;]

27-37  community managers;

27-38     (d) Must establish the grounds for initiating disciplinary action

27-39  against a person to whom a certificate has been issued, including,

27-40  without limitation, the grounds for placing conditions, limitations or

27-41  restrictions on a certificate and for the suspension or revocation of a

27-42  certificate; and

27-43     (e) Must establish rules of practice and procedure for conducting

27-44  disciplinary hearings.

28-1  The [Real Estate Division of the Department of Business and

28-2  Industry] Division may investigate the [property] community

28-3  managers to whom certificates have been issued to ensure their

28-4  compliance with the standards of practice adopted pursuant to this

28-5  subsection and collect a fee for the issuance of a certificate by the

28-6  [Commission] Division in an amount not to exceed the

28-7  administrative costs of issuing the certificate.

28-8      4.  The provisions of subsection 2 do not apply to:

28-9      (a) [A person who is engaged in property management for a

28-10  common-interest community on October 1, 1999, and is granted an

28-11  exemption from the requirements of subsection 2 by the

28-12  Administrator upon demonstration that he is qualified and

28-13  competent to engage in property management for a common-interest

28-14  community.

28-15     (b)] A financial institution.

28-16     [(c)] (b) An attorney licensed to practice in this state.

28-17     [(d)] (c) A trustee.

28-18     [(e) An employee of a corporation who manages only the

28-19  property of the corporation .]

28-20     [(f)] (d) A declarant.

28-21     [(g)] (e) A receiver.

28-22     [5.  As used in this section, “property management” means the

28-23  physical, administrative or financial maintenance and management

28-24  of real property, or the supervision of those activities for a fee,

28-25  commission or other compensation or valuable consideration.]

28-26     (f) An officer or member of the executive board of an

28-27  association acting solely within the scope of his capacity as an

28-28  officer or member of the executive board.

28-29     Sec. 42.  NRS 116.31152 is hereby amended to read as

28-30  follows:

28-31     116.31152  1.  The executive board of an association shall:

28-32     (a) Cause to be conducted at least once every 5 years, a study of

28-33  the reserves required to repair, replace and restore the major

28-34  components of the common elements;

28-35     (b) Review the results of that study at least annually to

28-36  determine if those reserves are sufficient; and

28-37     (c) Make any adjustments it deems necessary to maintain the

28-38  required reserves.

28-39     2.  The study required by subsection 1 must be conducted by a

28-40  person qualified by training and experience to conduct such a study,

28-41  including a member of the executive board, a unit’s owner or the

28-42  [property] community manager of the association who is so

28-43  qualified. The study must include, without limitation:

29-1      (a) A summary of an inspection of the major components of the

29-2  common elements the association is obligated to repair, replace or

29-3  restore;

29-4      (b) An identification of the major components of the common

29-5  elements that the association is obligated to repair, replace or restore

29-6  which have a remaining useful life of less than 30 years;

29-7      (c) An estimate of the remaining useful life of each major

29-8  component identified pursuant to paragraph (b);

29-9      (d) An estimate of the cost of repair, replacement or restoration

29-10  of each major component identified pursuant to paragraph (b) during

29-11  and at the end of its useful life; and

29-12     (e) An estimate of the total annual assessment that may be

29-13  required to cover the cost of repairing, replacement or restoration of

29-14  the major components identified pursuant to paragraph (b), after

29-15  subtracting the reserves of the association as of the date of the study.

29-16     3.  The Administrator shall adopt by regulation the

29-17  qualifications required for conducting a study required by

29-18  subsection 1.

29-19     Sec. 43.  NRS 116.31155 is hereby amended to read as

29-20  follows:

29-21     116.31155  1.  An association shall:

29-22     (a) If the association is required to pay the fee imposed by NRS

29-23  78.150 [or 82.193,] , 82.193 or 86.263, pay to the Administrator a

29-24  fee established by regulation of the Administrator for every unit in

29-25  the association used for residential use.

29-26     (b) If the association is organized as a trust or partnership, pay

29-27  to the Administrator a fee established by regulation of the

29-28  Administrator for each unit in the association.

29-29     2.  The fees required to be paid pursuant to this section must be:

29-30     (a) Paid at such times as are established by the [Administrator.]

29-31  Division.

29-32     (b) Deposited with the State Treasurer for credit to the Account

29-33  for [the Ombudsman for Owners in] Common-Interest Communities

29-34  created pursuant to NRS 116.1117.

29-35     (c) Established on the basis of the actual cost of administering

29-36  the Office of the Ombudsman for Owners in Common-Interest

29-37  Communities and not on a basis which includes any subsidy for the

29-38  office. In no event may the fees required to be paid pursuant to this

29-39  section exceed $3 per unit.

29-40     3.  The Administrator shall adopt regulations providing for a

29-41  penalty if an association fails to pay the fees required pursuant to

29-42  this section. The penalty must not exceed 10 percent of the fees or

29-43  $500, whichever is less.

29-44     4.  A unit’s owner may not be required to pay any portion of the

29-45  fees or a penalty for the failure to pay a fee required to be paid

30-1  pursuant to this section to a master association and to an association

30-2  organized pursuant to NRS 116.3101.

30-3      [4.] 5.  Upon the payment of the fees required by this section,

30-4  the Administrator shall provide to the association evidence that it

30-5  paid the fees in compliance with this section.

30-6      Sec. 44.  NRS 116.31158 is hereby amended to read as

30-7  follows:

30-8      116.31158  1.  Each association shall, at the time it pays the

30-9  fee required by NRS 116.31155, register with the Ombudsman for

30-10  Owners in Common-Interest Communities on a form prescribed by

30-11  the Ombudsman.

30-12     2.  The form for registration must include, without limitation,

30-13  the information required to be maintained pursuant to paragraph

30-14  [(d)] (e) of subsection 4 of NRS 116.1116.

30-15     Sec. 45.  NRS 116.3116 is hereby amended to read as follows:

30-16     116.3116  1.  The association has a lien on a unit for any

30-17  assessment levied against that unit , construction penalty imposed

30-18  on the unit’s owner pursuant to section 18 of this act or fines

30-19  imposed against the unit’s owner from the time the assessment ,

30-20  construction penalty or fine becomes due. Unless the declaration

30-21  otherwise provides, fees, charges, late charges, fines and interest

30-22  charged pursuant to paragraphs (j) [, ( k) and (l)] to (m), inclusive,

30-23  of subsection 1 of NRS 116.3102 are enforceable as assessments

30-24  under this section. If an assessment is payable in installments, the

30-25  full amount of the assessment is a lien from the time the first

30-26  installment thereof becomes due.

30-27     2.  A lien under this section is prior to all other liens and

30-28  encumbrances on a unit except:

30-29     (a) Liens and encumbrances recorded before the recordation of

30-30  the declaration and, in a cooperative, liens and encumbrances which

30-31  the association creates, assumes or takes subject to;

30-32     (b) A first security interest on the unit recorded before the date

30-33  on which the assessment sought to be enforced became delinquent,

30-34  or, in a cooperative, the first security interest encumbering only the

30-35  unit’s owner’s interest and perfected before the date on which the

30-36  assessment sought to be enforced became delinquent; and

30-37     (c) Liens for real estate taxes and other governmental

30-38  assessments or charges against the unit or cooperative.

30-39  The lien is also prior to all security interests described in paragraph

30-40  (b) to the extent of the assessments for common expenses based on

30-41  the periodic budget adopted by the association pursuant to NRS

30-42  116.3115 which would have become due in the absence of

30-43  acceleration during the 6 months immediately preceding institution

30-44  of an action to enforce the lien. This subsection does not affect the

31-1  priority of mechanics’ or materialmen’s liens, or the priority of liens

31-2  for other assessments made by the association.

31-3      3.  Unless the declaration otherwise provides, if two or more

31-4  associations have liens for assessments created at any time on the

31-5  same property, those liens have equal priority.

31-6      4.  Recording of the declaration constitutes record notice and

31-7  perfection of the lien. No further recordation of any claim of lien for

31-8  assessment under this section is required.

31-9      5.  A lien for unpaid assessments is extinguished unless

31-10  proceedings to enforce the lien are instituted within 3 years after the

31-11  full amount of the assessments becomes due.

31-12     6.  This section does not prohibit actions to recover sums for

31-13  which subsection 1 creates a lien or prohibit an association from

31-14  taking a deed in lieu of foreclosure.

31-15     7.  A judgment or decree in any action brought under this

31-16  section must include costs and reasonable attorney’s fees for the

31-17  prevailing party.

31-18     8.  The association upon written request shall furnish to a unit’s

31-19  owner a statement setting forth the amount of unpaid assessments

31-20  against the unit. If the interest of the unit’s owner is real estate, the

31-21  statement must be in recordable form. The statement must be

31-22  furnished within 10 business days after receipt of the request and is

31-23  binding on the association, the executive board and every unit’s

31-24  owner.

31-25     9.  In a cooperative, upon nonpayment of an assessment on a

31-26  unit, the unit’s owner may be evicted in the same manner as

31-27  provided by law in the case of an unlawful holdover by a

31-28  commercial tenant, and the lien may be foreclosed as provided by

31-29  this section or by NRS 116.31162 to 116.31168, inclusive.

31-30     10.  In a cooperative where the owner’s interest in a unit is

31-31  personal property [(NRS 116.1105),] as provided in NRS 116.1105,

31-32  the association’s lien may be foreclosed in like manner as a security

31-33  interest under NRS 104.9101 to 104.9709, inclusive.

31-34     Sec. 46.  NRS 116.31162 is hereby amended to read as

31-35  follows:

31-36     116.31162  1.  Except as otherwise provided in subsection 4,

31-37  in a condominium, a cooperative where the owner’s interest in a unit

31-38  is real estate as determined pursuant to NRS 116.1105, or a planned

31-39  community, the association may foreclose its lien by sale after:

31-40     (a) The association has mailed by certified or registered mail,

31-41  return receipt requested, to the unit’s owner or his successor in

31-42  interest, at his address if known, and at the address of the unit, a

31-43  notice of delinquent assessment which states the amount of the

31-44  assessments and other sums which are due in accordance with

31-45  subsection 1 of NRS 116.3116, a description of the unit against

32-1  which the lien is imposed, and the name of the record owner of the

32-2  unit;

32-3      (b) [The] Not less than 30 days after mailing the notice of

32-4  delinquent assessment pursuant to paragraph (a), the association

32-5  or other person conducting the sale has executed and caused to be

32-6  recorded, with the county recorder of the county in which the

32-7  common-interest community or any part of it is situated, a notice of

32-8  default and election to sell the unit to satisfy the lien, which contains

32-9  the same information as the notice of delinquent assessment, but

32-10  must also describe the deficiency in payment and the name and

32-11  address of the person authorized by the association to enforce the

32-12  lien by sale; and

32-13     (c) The unit’s owner or his successor in interest has failed to pay

32-14  the amount of the lien, including costs, fees and expenses incident to

32-15  its enforcement, for [60] 90 days following the recording of the

32-16  notice of default and election to sell.

32-17     2.  The notice of default and election to sell must be signed by

32-18  the person designated in the declaration or by the association for that

32-19  purpose, or if no one is designated, by the president of the

32-20  association.

32-21     3.  The period of [60] 90 days begins on the first day following

32-22  the later of:

32-23     (a) The day on which the notice of default is recorded; or

32-24     (b) The day on which a copy of the notice of default is mailed

32-25  by certified or registered mail, return receipt requested, to the unit’s

32-26  owner or his successor in interest at his address if known, and at the

32-27  address of the unit.

32-28     4.  The association may not foreclose a lien [by sale for the

32-29  assessment of] based on a fine for a violation or continuing

32-30  violation of the [declaration, bylaws, rules or regulations] governing

32-31  documents of the association, unless [the violation is of a type] :

32-32     (a) The fine is imposed for a violation or continuing violation

32-33  that threatens the health, safety or welfare of the residents of the

32-34  common-interest community[.] ; or

32-35     (b) The fine is a construction penalty imposed pursuant to

32-36  section 18 of this act.

32-37     Sec. 47.  NRS 116.311635 is hereby amended to read as

32-38  follows:

32-39     116.311635  The association or other person conducting the

32-40  sale shall also, after the expiration of the 60 days and before selling

32-41  the unit:

32-42     1.  Give notice of the time and place of the sale in the manner

32-43  and for a time not less than that required by law for the sale of real

32-44  property upon execution, except that a copy of the notice of sale

32-45  must be mailed, on or before the date of first publication or posting,

33-1  by certified or registered mail, return receipt requested, to the unit’s

33-2  owner or his successor in interest at his address if known, and to the

33-3  address of the unit.

33-4      2.  Mail, on or before the date of first publication or posting, a

33-5  copy of the notice by first-class mail to:

33-6      (a) Each person entitled to receive a copy of the notice of default

33-7  and election to sell notice under NRS 116.31163; [and]

33-8      (b) The holder of a recorded security interest or the purchaser of

33-9  the unit, if either of them has notified the association, before the

33-10  mailing of the notice of sale, of the existence of the security interest,

33-11  lease or contract of sale, as applicable[.] ; and

33-12     (c) The Ombudsman for Owners in Common-Interest

33-13  Communities.

33-14     Sec. 48.  NRS 116.31175 is hereby amended to read as

33-15  follows:

33-16     116.31175  1.  Except as otherwise provided in this

33-17  subsection, the executive board of an association shall, upon the

33-18  written request of a unit’s owner, make available the books, records

33-19  and other papers of the association for review during the regular

33-20  working hours of the association [.] , including, without limitation,

33-21  all records filed with a court relating to a civil or criminal action

33-22  to which the association is a party. The provisions of this

33-23  subsection do not apply to:

33-24     (a) The personnel records of the employees of the association [;]

33-25  , except for those records relating to the salaries and benefits of

33-26  those employees; and

33-27     (b) The records of the association relating to another unit’s

33-28  owner.

33-29     2.  If the executive board refuses to allow a unit’s owner to

33-30  review the books, records or other papers of the association, the

33-31  Ombudsman for Owners in Common-Interest Communities may:

33-32     (a) On behalf of the unit’s owner and upon written request,

33-33  review the books, records or other papers of the association during

33-34  the regular working hours of the association; and

33-35     (b) If he is denied access to the books, records or other papers,

33-36  request the Commission to issue a subpoena for their production.

33-37     3.  The books, records and other papers of an association

33-38  must be maintained for at least 10 years.

33-39     Sec. 49.  NRS 116.4109 is hereby amended to read as follows:

33-40     116.4109  1.  Except in the case of a sale in which delivery of

33-41  a public offering statement is required, or unless exempt under

33-42  subsection 2 of NRS 116.4101, a unit’s owner shall furnish to a

33-43  purchaser before execution of any contract for sale of a unit, or

33-44  [otherwise] in the absence of a contract for sale before

33-45  conveyance:

34-1      (a) A copy of the declaration, other than any plats and plans, the

34-2  bylaws, the rules or regulations of the association and the

34-3  information statement required by NRS 116.41095;

34-4      (b) A statement setting forth the amount of the monthly

34-5  assessment for common expenses and any unpaid assessment of any

34-6  kind currently due from the selling unit’s owner;

34-7      (c) The current operating budget of the association and a

34-8  financial statement for the association; and

34-9      (d) A statement of any unsatisfied judgments or pending legal

34-10  actions against the association and the status of any pending legal

34-11  actions relating to the common-interest community of which the

34-12  unit’s owner has actual knowledge.

34-13     2.  The association, within 10 days after a request by a unit’s

34-14  owner, shall furnish a certificate containing the information

34-15  necessary to enable the unit’s owner to comply with this section. A

34-16  unit’s owner providing a certificate pursuant to subsection 1 is not

34-17  liable to the purchaser for any erroneous information provided by

34-18  the association and included in the certificate.

34-19     3.  Neither a purchaser nor the purchaser’s interest in a unit is

34-20  liable for any unpaid assessment or fee greater than the amount set

34-21  forth in the certificate prepared by the association. If the association

34-22  fails to furnish the certificate within the 10 days allowed by

34-23  subsection 2, the seller is not liable for the delinquent assessment.

34-24     Sec. 50.  NRS 116.41095 is hereby amended to read as

34-25  follows:

34-26     116.41095  The information statement required by NRS

34-27  116.4103 and 116.4109 must be in substantially the following form:

 

34-28  BEFORE YOU PURCHASE PROPERTY IN A

34-29  COMMON-INTEREST COMMUNITY

34-30  DID YOU KNOW . . .

34-31     1.  YOU ARE AGREEING TO RESTRICTIONS ON HOW

34-32  YOU CAN USE YOUR PROPERTY?

34-33  These restrictions are contained in a document known as the

34-34  Declaration of Covenants, Conditions and Restrictions (C, C & R’s)

34-35  that should be provided for your review before making your

34-36  purchase. The C, C & R’s become a part of the title to your

34-37  property. They bind you and every future owner of the property

34-38  whether or not you have read them or had them explained to you.

34-39  The C, C & R’s, together with other “governing documents” (such

34-40  as association bylaws and rules and regulations), are intended to

34-41  preserve the character and value of properties in the community, but

34-42  may also restrict what you can do to improve or change your

34-43  property and limit how you use and enjoy your property. By

34-44  purchasing a property encumbered by C, C & R’s, you are agreeing

35-1  to limitations that could affect your lifestyle and freedom of choice.

35-2  You should review the C, C & R’s and other governing documents

35-3  before purchasing to make sure that these limitations and controls

35-4  are acceptable to you.

35-5      2.  YOU WILL HAVE TO PAY OWNERS’ ASSESSMENTS

35-6  FOR AS LONG AS YOU OWN YOUR PROPERTY?

35-7  As an owner in a common-interest community, you are responsible

35-8  for paying your share of expenses relating to the common elements,

35-9  such as landscaping, shared amenities and the operation of any

35-10  homeowner’s association. The obligation to pay these assessments

35-11  binds you and every future owner of the property. Owners’ fees are

35-12  usually assessed by the homeowner’s association and due monthly.

35-13  You have to pay dues whether or not you agree with the way the

35-14  association is managing the property or spending the assessments.

35-15  The executive board of the association may have the power to

35-16  change and increase the amount of the assessment and to levy

35-17  special assessments against your property to meet extraordinary

35-18  expenses. In some communities, major components of the

35-19  community such as roofs and private roads must be maintained and

35-20  replaced by the association. If the association is not well managed or

35-21  fails to maintain adequate reserves to repair, replace and restore

35-22  common elements, you may be required to pay large, special

35-23  assessments to accomplish these tasks.

35-24     3.  IF YOU FAIL TO PAY OWNERS’ ASSESSMENTS, YOU

35-25  COULD LOSE YOUR HOME?

35-26  If you do not pay these assessments when due, the association

35-27  usually has the power to collect them by selling your property in a

35-28  nonjudicial foreclosure sale. If fees become delinquent, you may

35-29  also be required to pay penalties and the association’s costs and

35-30  attorney’s fees to become current. If you dispute the obligation or its

35-31  amount, your only remedy to avoid the loss of your home may be to

35-32  file a lawsuit and ask a court to intervene in the dispute.

35-33     4.  YOU MAY BECOME A MEMBER OF A

35-34  HOMEOWNER’S ASSOCIATION THAT HAS THE POWER TO

35-35  AFFECT HOW YOU USE AND ENJOY YOUR PROPERTY?

35-36  Many common-interest communities have a homeowner’s

35-37  association. In a new development, the association will usually be

35-38  controlled by the developer until a certain number of units have

35-39  been sold. After the period of developer control, the association may

35-40  be controlled by property owners like yourself who are elected by

35-41  homeowners to sit on an executive board and other boards and

35-42  committees formed by the association. The association, and its

35-43  executive board, are responsible for assessing homeowners for the

35-44  cost of operating the association and the common or shared

35-45  elements of the community and for the day to day operation and

36-1  management of the community. Because homeowners sitting on the

36-2  executive board and other boards and committees of the association

36-3  may not have the experience or professional background required to

36-4  understand and carry out the responsibilities of the association

36-5  properly, the association may hire professional managers to carry

36-6  out these responsibilities.

36-7  Homeowner’s associations operate on democratic principles. Some

36-8  decisions require all homeowners to vote, some decisions are made

36-9  by the executive board or other boards or committees established by

36-10  the association or governing documents. Although the actions of the

36-11  association and its executive board are governed by state laws, the

36-12  C, C & R’s and other documents that govern the common-interest

36-13  community, decisions made by these persons will affect your use

36-14  and enjoyment of your property, your lifestyle and freedom of

36-15  choice, and your cost of living in the community. You may not

36-16  agree with decisions made by the association or its governing bodies

36-17  even though the decisions are ones which the association is

36-18  authorized to make. Decisions may be made by a few persons on the

36-19  executive board or governing bodies that do not necessarily reflect

36-20  the view of the majority of homeowners in the community. If you do

36-21  not agree with decisions made by the association, its executive

36-22  board or other governing bodies, your remedy is typically to attempt

36-23  to use the democratic processes of the association to seek the

36-24  election of members of the executive board or other governing

36-25  bodies that are more responsive to your needs. If persons controlling

36-26  the association or its management are not complying with state laws

36-27  or the governing documents, your remedy is typically to seek to

36-28  mediate or arbitrate the dispute and, if mediation or arbitration is

36-29  unsuccessful, file a lawsuit and ask a court to resolve the dispute. In

36-30  addition to your personal cost in mediation or arbitration, or to

36-31  prosecute a lawsuit, you may be responsible for paying your share

36-32  of the association’s cost in defending against your claim. There is no

36-33  government agency in this state that investigates or intervenes to

36-34  resolve disputes in homeowner’s associations.

36-35     5.  YOU ARE REQUIRED TO PROVIDE PROSPECTIVE

36-36  BUYERS OF YOUR PROPERTY WITH INFORMATION

36-37  ABOUT LIVING IN YOUR COMMON-INTEREST

36-38  COMMUNITY?

36-39  The law requires you to provide to a prospective purchaser of your

36-40  property, before you enter into a purchase agreement, a copy of the

36-41  community’s governing documents, including the C, C & R’s,

36-42  association bylaws, and rules and regulations, as well as a copy of

36-43  this document. You are also required to provide a copy of the

36-44  association’s current financial statement, operating budget and

36-45  information regarding the amount of the monthly assessment for

37-1  common expenses, including the amount set aside as reserves for the

37-2  repair, replacement and restoration of common elements. You are

37-3  also required to inform prospective purchasers of any outstanding

37-4  judgments or lawsuits pending against the association of which you

37-5  are aware. You are also required to provide a copy of the minutes

37-6  from the most recent meeting of the homeowner’s association or its

37-7  executive board. For more information regarding these

37-8  requirements, see Nevada Revised Statutes 116.4103 [.] and

37-9  116.4109.

37-10     6.  YOU HAVE CERTAIN RIGHTS REGARDING

37-11  OWNERSHIP IN A COMMON-INTEREST COMMUNITY THAT

37-12  ARE GUARANTEED YOU BY THE STATE?

37-13  Pursuant to provisions of chapter 116 of Nevada Revised Statutes,

37-14  you have the right:

37-15     (a) To be notified of all meetings of the association and its

37-16  executive board, except in cases of emergency.

37-17     (b) To attend and speak at all meetings of the association and its

37-18  executive board, except in some cases where the executive board is

37-19  authorized to meet in closed, executive session.

37-20     (c) To request a special meeting of the association upon petition

37-21  of at least 10 percent of the homeowners.

37-22     (d) To inspect, examine, photocopy and audit financial and other

37-23  records of the association.

37-24     (e) To be notified of all changes in the community’s rules and

37-25  regulations and other actions by the association or board that affect

37-26  you.

37-27     7.  QUESTIONS?

37-28  Although they may be voluminous, you should take the time to read

37-29  and understand the documents that will control your ownership of a

37-30  property in a common-interest community. You may wish to ask

37-31  your real estate professional, lawyer or other person with experience

37-32  to explain anything you do not understand. You may also request

37-33  assistance from the Ombudsman for Owners in Common-Interest

37-34  Communities, Nevada Real Estate Division, at (telephone number).

 

37-35  Buyer or prospective buyer’s initials:_____

37-36  Date:_____

37-37     Sec. 51.  NRS 38.300 is hereby amended to read as follows:

37-38     38.300  As used in NRS 38.300 to 38.360, inclusive, unless the

37-39  context otherwise requires:

37-40     1.  “Assessments” means:

37-41     (a) Any charge which an association may impose against an

37-42  owner of residential property pursuant to a declaration of covenants,

37-43  conditions and restrictions, including any late charges, interest and

37-44  costs of collecting the charges; and

38-1      (b) Any fines, fees and other charges which may be imposed by

38-2  an association pursuant to paragraphs (j) [, (k) and (l)] to (m),

38-3  inclusive, of subsection 1 of NRS 116.3102.

38-4      2.  “Association” has the meaning ascribed to it in

38-5  NRS 116.110315.

38-6      3.  “Civil action” includes an action for money damages or

38-7  equitable relief. The term does not include an action in equity for

38-8  injunctive relief in which there is an immediate threat of irreparable

38-9  harm, or an action relating to the title to residential property.

38-10     4.  “Division” means the Real Estate Division of the

38-11  Department of Business and Industry.

38-12     5.  “Residential property” includes, but is not limited to, real

38-13  estate within a planned community subject to the provisions of

38-14  chapter 116 of NRS. The term does not include commercial property

38-15  if no portion thereof contains property which is used for residential

38-16  purposes.

38-17     Sec. 52.  NRS 38.330 is hereby amended to read as follows:

38-18     38.330  1.  If all parties named in a written claim filed

38-19  pursuant to NRS 38.320 agree to have the claim submitted for

38-20  mediation, the parties shall reduce the agreement to writing and

38-21  shall select a mediator from the list of mediators maintained by the

38-22  Division pursuant to NRS 38.340. Any mediator selected must be

38-23  available within the geographic area. If the parties fail to agree upon

38-24  a mediator, the Division shall appoint a mediator from the list of

38-25  mediators maintained by the Division. Any mediator appointed must

38-26  be available within the geographic area. Unless otherwise provided

38-27  by an agreement of the parties, mediation must be completed within

38-28  60 days after the parties agree to mediation. Any agreement

38-29  obtained through mediation conducted pursuant to this section must,

38-30  within 20 days after the conclusion of mediation, be reduced to

38-31  writing by the mediator and a copy thereof provided to each party.

38-32  The agreement may be enforced as any other written agreement.

38-33  Except as otherwise provided in this section, the parties are

38-34  responsible for all costs of mediation conducted pursuant to this

38-35  section.

38-36     2.  If all the parties named in the claim do not agree to

38-37  mediation, the parties shall select an arbitrator from the list of

38-38  arbitrators maintained by the Division pursuant to NRS 38.340. Any

38-39  arbitrator selected must be available within the geographic area. If

38-40  the parties fail to agree upon an arbitrator, the Division shall appoint

38-41  an arbitrator from the list maintained by the Division. Any arbitrator

38-42  appointed must be available within the geographic area. Upon

38-43  appointing an arbitrator, the Division shall provide the name of the

38-44  arbitrator to each party.

39-1      3.  The Division may provide for the payment of the fees for a

39-2  mediator or an arbitrator selected or appointed pursuant to this

39-3  section from the Account for [the Ombudsman for Owners in]

39-4  Common-Interest Communities created pursuant to NRS 116.1117,

39-5  to the extent that money is available in the Account for this purpose.

39-6      4.  Except as otherwise provided in this section and except

39-7  where inconsistent with the provisions of NRS 38.300 to 38.360,

39-8  inclusive, the arbitration of a claim pursuant to this section must be

39-9  conducted in accordance with the provisions of NRS 38.231,

39-10  38.232, 38.233, 38.236 to 38.239, inclusive, 38.242 and 38.243. At

39-11  any time during the arbitration of a claim relating to the

39-12  interpretation, application or enforcement of any covenants,

39-13  conditions or restrictions applicable to residential property or any

39-14  bylaws, rules or regulations adopted by an association, the arbitrator

39-15  may issue an order prohibiting the action upon which the claim is

39-16  based. An award must be made within 30 days after the conclusion

39-17  of arbitration, unless a shorter period is agreed upon by the parties to

39-18  the arbitration.

39-19     5.  If all the parties have agreed to nonbinding arbitration, any

39-20  party to the arbitration may, within 30 days after a decision and

39-21  award have been served upon the parties, commence a civil action in

39-22  the proper court concerning the claim which was submitted for

39-23  arbitration. Any complaint filed in such an action must contain a

39-24  sworn statement indicating that the issues addressed in the

39-25  complaint have been arbitrated pursuant to the provisions of NRS

39-26  38.300 to 38.360, inclusive. If such an action is not commenced

39-27  within that period, any party to the arbitration may, within 1 year

39-28  after the service of the award, apply to the proper court for a

39-29  confirmation of the award pursuant to NRS 38.239.

39-30     6.  If all the parties agree in writing to binding arbitration, the

39-31  arbitration must be conducted in accordance with the provisions of

39-32  chapter 38 of NRS. An award procured pursuant to such arbitration

39-33  may be vacated and a rehearing granted upon application of a party

39-34  pursuant to the provisions of NRS 38.241.

39-35     7.  If, after the conclusion of arbitration, a party:

39-36     (a) Applies to have an award vacated and a rehearing granted

39-37  pursuant to NRS 38.241; or

39-38     (b) Commences a civil action based upon any claim which was

39-39  the subject of arbitration,

39-40  the party shall, if he fails to obtain a more favorable award or

39-41  judgment than that which was obtained in the initial arbitration, pay

39-42  all costs and reasonable attorney’s fees incurred by the opposing

39-43  party after the application for a rehearing was made or after the

39-44  complaint in the civil action was filed.

40-1      8.  Upon request by a party, the Division shall provide a

40-2  statement to the party indicating the amount of the fees for a

40-3  mediator or an arbitrator selected or appointed pursuant to this

40-4  section.

40-5      9.  As used in this section, “geographic area” means an area

40-6  within 150 miles from any residential property or association which

40-7  is the subject of a written claim submitted pursuant to NRS 38.320.

40-8      Sec. 53.  1.  The provisions of this act apply to any violation

40-9  or continuing violation of the governing documents of an

40-10  association or master association that occurs on or after October 1,

40-11  2003.

40-12     2.  Notwithstanding any other law to the contrary, if the

40-13  provisions of the governing documents of an association or master

40-14  association do not conform to the amendatory provisions of this act:

40-15     (a) The nonconforming provisions of the governing documents

40-16  shall be deemed to have been conformed to the amendatory

40-17  provisions of this act by operation of law on October 1, 2003; and

40-18     (b) If the association or master association is associated with a

40-19  common-interest community that was created on or after January 1,

40-20  1992, the executive board of the association or master association

40-21  shall, before October 1, 2004, change the nonconforming provisions

40-22  of the governing documents to conform to the amendatory

40-23  provisions of this act. The executive board of the association or

40-24  master association may make such changes without complying with

40-25  any procedural requirements that would otherwise apply if the

40-26  executive board were to amend the governing documents of the

40-27  association or master association in accordance with law.

40-28     3.  As used in this section:

40-29     (a) “Association” has the meaning ascribed to it in

40-30  NRS 116.110315.

40-31     (b) “Common-interest community” has the meaning ascribed to

40-32  it in NRS 116.110323.

40-33     (c) “Executive board” has the meaning ascribed to it in

40-34  NRS 116.110345.

40-35     (d) “Governing documents” has the meaning ascribed to it in

40-36  NRS 116.110347.

40-37     (e) “Master association” has the meaning ascribed to it in

40-38  NRS 116.110358.

40-39     Sec. 54.  Notwithstanding the provisions of section 41 of this

40-40  act, a person who acts as a community manager is not required to be

40-41  certified pursuant to the provisions of this act before January 1,

40-42  2004.

40-43     Sec. 55.  1.  By January 1, 2005, an executive board of an

40-44  association or master association of a common-interest community

40-45  shall have conducted elections of members of the executive board so

41-1  that the terms of the members of the executive board are staggered

41-2  as required by the amendatory provisions of section 32 of this act.

41-3      2.  As used in this section:

41-4      (a) “Association” has the meaning ascribed to it in

41-5  NRS 116.110315.

41-6      (b) “Common-interest community” has the meaning ascribed to

41-7  it in NRS 116.110323.

41-8      (c) “Executive board” has the meaning ascribed to it in

41-9  NRS 116.110345.

41-10     (d) “Master association” has the meaning ascribed to it in

41-11  NRS 116.110358.

41-12     Sec. 56.  The State Treasurer shall transfer any balance

41-13  remaining unexpended on October 1, 2003, in the Account for the

41-14  Ombudsman for Owners in Common-Interest Communities in the

41-15  State General Fund to the Account for Common-Interest

41-16  Communities which is created by NRS 116.1117, as amended by

41-17  this act.

41-18     Sec. 57.  1.  This act becomes effective on October 1, 2003.

41-19     2.  Sections8, 9 and 10of this act expire by limitation on the

41-20  date on which the provisions of 42 U.S.C. § 666 requiring each state

41-21  to establish procedures under which the state has authority to

41-22  withhold or suspend, or to restrict the use of professional,

41-23  occupational and recreational licenses of persons who:

41-24     (a) Have failed to comply with a subpoena or warrant relating to

41-25  a proceeding to determine the paternity of a child or to establish or

41-26  enforce an obligation for the support of a child; or

41-27     (b) Are in arrears in the payment for the support of one or more

41-28  children,

41-29  are repealed by the Congress of the United States.

 

41-30  H