Virginia: 2019 Legislative Update for Common Interest Communities

Date: June 26, 2019
The Virginia General Assembly approved a number of bills during its 2019 legislative session.  Several of the bills impact, directly or indirectly, common interest communities.  The Governor of Virginia signed the following bills into law in March and the new laws will take effect on July 1, 2019, except as otherwise noted herein.  We have outlined the legislative action taken by the Virginia General Assembly that we believe most directly affect both homeowners and condominium associations.

The following bills amend the Virginia Property Owners’ Association Act (Va. Code Ann. 55-508, et seq., as amended (1950)), the Virginia Condominium Act (Va. Code Ann. 55-79.39, et seq., as amended (1950)), and other statutes that may affect common interest communities.  Please feel free to contact us if you have questions regarding any of the following legislative changes.

Home-based businesses
HB 1853 and SB 1537 amends the Virginia Property Owners' Association Act by adding a new subsection to § 55-513.2, which permits home-based businesses, and now requires Associations to allow home-based child care providers.  Specifically, the bill provides that if a development is located in a locality classifying home-based child care services as an accessory or ancillary residential use under the locality's zoning ordinance, then providing home-based child care services in a personal residence shall be deemed a permitted residential use unless (i) it’s expressly prohibited or otherwise restricted by the Association’s declaration or (ii) it’s restricted by the Association’s bylaws or any reasonable rule the Association establishes as to the time, place and manner of the operation and the placement of signs.  This amendment does not impact condominiums or cooperatives.

Dissemination of annual budget and reserve for capital components.
HB 2030 and SB 1538 amends the Virginia Property Owners Act and the Virginia Condominium Act and the Virginia Real Estate Cooperative Act to require Associations to make available to members (i) the Association’s annual budget or (ii) a summary of the annual budget prior to the beginning of each fiscal year.  The bill also now requires that the Association budget include a statement that outlines the amount of the reserves recommended in the reserve study as well as the amount of current cash available for replacement reserves. The bill also requires the Common Interest Community Board (the “CIC Board”) to prepare guidelines for the development of reserve studies for capital components, including a list of capital components that should be addressed in a reserve study. 

Delivery of condominium resale certificates
HB 2385 and SB 1580 amends the Virginia Condominium and Virginia Property Owners' Association Acts and provides that a purchaser who receives a condominium resale certificate or association disclosure packet that does not contain the information required under either Act may cancel the contract for such unit or lot (i) within three days after the contract date if the resale certificate or disclosure packet was received on or before purchaser signed the contract; (ii) within three days of receiving the resale certificate or disclosure packet if it’s hand delivered, delivered by electronic means or overnight delivery service or the United States Postal Service, and a receipt obtained; or (iii) within six days after the postmark date if the resale certificate or disclosure packet is sent to the purchaser by United States mail.  Essentially, this amendment does not substantively change the current practice because a purchaser can cancel the contract for any reason within three days.  However, the amendment may subject an Association to liability for the contract termination if the resale certificate or disclosure packet is incomplete. 

Stormwater facilities
SB 1756 amends the Virginia Condominium and Virginia Property Owners' Association Acts to require a declarant to deliver to the Association Board of Directors or its designated agent an inventory and description of stormwater facilities located on the common areas or which otherwise serve the property and for which the Association may have maintenance, repair, or replacement responsibility, together with the requirements for maintenance.  Delivery of the required information shall be deemed satisfied by delivery of a final site plan or construction drawings showing the stormwater facilities and delivery of applicable recorded easements and agreements containing requirements for the maintenance, repair or replacement of the facilities. 

Association meeting notices
HB 2694 amends the Virginia Property Owners' Association Act and now allows members of property owners' associations to elect to receive notice of meetings of the association by email in lieu of the current requirement that such notice be sent by United States mail or hand delivered, provided that in the event that such electronic mail is returned as undeliverable, notice is subsequently sent by United States mail.  The amendment essentially brings the Virginia Property Owners Act on all fours with the Virginia Condominium Act in regards to receipt of electronic meeting notices.  It’s important to note that the member must have affirmatively elected to receive the meeting notices electronically before the notice may be considered valid. 

Revision of Title 55 to create Title 55.1
SB 1080 creates proposed Title 55.1 (Property and Conveyances) as a revision of existing Title 55 (Property and Conveyances). The proposed Title 55.1 consists of 29 chapters divided into five subtitles, including Subtitle IV, which will contain the statutes governing common interest communities.  The bill was intended to organize the statutes in a more logical manner, remove obsolete and duplicative provisions, and improve the structure and clarity of statutes pertaining to property conveyances, recordation of deeds, and common interest communities, among others subjects.  Fortunately, the bill has a delayed effective date of October 1, 2019, at which time our firm will make available our complimentary Virginia statute books that will reflect the new statute numbering scheme mandated by the legislature.