Nearly every day, pieces of legislation are introduced, debated, or voted on—both in Trenton and in Washington—that impact the administration of New Jersey’s HOAs. Keeping track of what passes into law (and then must be complied with)  is a big job for property managers and their boards, but it’s important to stay abreast of changes in the law and to be aware of legislation  on the horizon or poised to be put into action.  

 Organizations like the New Jersey chapter of the Community Associations  Institute (CAI-NJ) and others make it their business to monitor the activities  of legislators at the local, state, and federal level and report back to their  membership on what’s going on in New Jersey’s 566 municipalities or in the State House. Sometimes what’s going on isn’t much—some pieces of legislation get hung up in committees for years before they come  to a final vote, and some never even get that far—but reporting on stalled bills is as important as staying on top of those that  get fast-tracked to ratification.  

 According to Mary Faith Radcliffe of RCP Management in Princeton and chair of  CAI-NJ’s Legislative Action Committee (LAC), they regularly track many pieces of  legislation of interest to condos and community associations.  

 According to Radcliffe, CAI-NJ and LAC hire an advocate, the Kauffman-Zeta  Group, to advise them of any pending legislation that would impact community  associations. KZG meets with them monthly to review the status of all bills, whether recently  introduced or in the final stages of review, and afterwards meet (often with  the bill sponsors) to discuss any concerns with the pending legislation.  

 New & Noteworthy

 In the past year, a number of new-and-important legislative initiatives have  influenced the way New Jersey HOA members and their board/management teams live  and conduct business. CAI, for example, was instrumental in quashing a proposal  that would have allowed homeowners to petition a bankruptcy court to rewrite  their mortgage obligations. This bill—known as HR 1106, or the “Helping Families Save their Home Act of 2009”—died in the U.S. Senate by a vote of 51-45.  

 Proponents of the legislation argued that record foreclosure numbers and the  resultant drag on housing prices could be offset by allowing the courts to  adjust delinquent homeowners’ mortgage payments to better fit their income, thus enabling them to remain in  their homes. On the other hand, CAI and others in opposition countered that the  legislation would possibly have increased lending costs and rewarded purchasers  who borrowed too much money or entered into unconventional, interest-only or  100 percent financed mortgages.  

 Two other bills also relate to foreclosure proceedings. The Assembly’s Committee on Housing and Local Government is weighing a proposal that would  allow the state’s Council on Affordable Housing (COAH) to permit a municipality to acquire and  take advantage of property foreclosures in the municipality to provide  affordable units. And another bill of interest to condo owners and  administrators currently in the Senate Committee on Law and Public Safety and  Veterans Affairs would permit the undersheriff to conduct foreclosure  proceedings on behalf of the county sheriff.  

 The Lowdown on Community Towing

 In October 2008, the “Predatory Towing Prevention Act” requirements went into effect. “While this bill was originally intended to stop rogue towing at commercial  establishments,” says Radcliffe, “there was a dramatic effect on associations.”  

 As originally written, the towing law required that a manager or “other association representative” be present whenever a vehicle was towed, regardless of the hour or day of the  week. Radcliffe says that the LAC lobbied legislators to amend the proposed law to  allow a phone call, fax or some other means of verification to be considered “representation” when a manager cannot be present. The original law also required large signs to  be posted at all community entrances detailing the information on the HOA’s contracted towing company.  

 According to Radcliffe, the LAC was able to dial back some of the towing bill’s more onerous requirements, and collaborated with lawmakers to craft a clean-up  bill addressing these issues. The new bill was accepted, and “recognizes the difference between a commercial parking area and parking in an  association,” says Radcliffe. “The new regulations are much more reasonable in their approach to residential  towing.”  

 Another bill that continues to concern HOAs is the potential conversion of  age-restricted units. In May, Governor Jon Corzine vetoed a bill that would  have allowed developers to convert a number of age-restricted housing units to  non-age restricted housing units prior to the initial sale of those units. “Naturally, many active adult communities were concerned about the consequences  of such a bill and were pleased with the governor’s veto,” Radcliffe explains. “The bill has been returned to the Senate for further consideration.”  

 Other Items of Interest

 The 2008-09 legislative session brought a number of other issues to the table.  Here’s a quick digest: S1450, introduced by Sen. Ronald Rice, D-28, enhances  protections afforded purchasers of homes in community association, particularly  in connection with transition activities, and home warranties related to  potential construction defects.  

 According to Radcliffe, “The LAC has been monitoring this bill and, where possible, participating in its  formulation. The committee will continue to monitor and participate in this  bill, which has also garnered attention by the New Jersey Builder’s Association.”  

 The bill has been reported out of committee and had a second reading in the  Senate. It has been referred to the Senate’s Budget and Appropriations Committee for further review.  

 Bed Bugs and Other Legal Creations

 On a slightly grosser note, A3203 and S2257 are the companion “bed bug” bills. As originally proposed, A3203, sponsored by Assemblywoman Joan M.  Quigley, D-32, and four of her colleagues, considers the association a “landlord” for the purposes of eradicating the tiny little pests—and holds HOAs responsible for shouldering the attendant financial burden. The  Assembly version of the bill passed muster by a vote of 74-3-0 in February, and  S2257 was referred to the Senate Community and Urban Affairs Committee.  

 “I previously participated in a roundtable discussion [on the bill],” says Radcliffe, “and expressed the LAC’s concerns with it. Amendments were proposed by the LAC to clarify responsibility for eradication  within units and to impose this obligation upon the proper responsible party—the owner.” As of March 2009, A3203 was successfully amended to impose the responsibility  for eradicating bedbugs on unit owners rather than their associations.  

 Assembly bill, A3114, sponsored by Assemblyman Ronald S. Dancer, R-30, would  provide equitable treatment for community associations in connection with  standby fees or charges for fire protection systems (hydrants, specifically) by  water companies. It was introduced in September 2008 and then assigned to the  Assembly Housing and Local Government Committee. Adoption of this bill would  prohibit standby water fees or charges for water not used but required for a  fire suppression system.  

 “If your community has a fire sprinkler system, you are probably paying a  quarterly water bill even though there is no water usage,” says Radcliffe. “Typically, the association pays a hefty charge for water that is not being used  unless there is a fire. If you are in this situation, you certainly know what  an expensive burden these water bills can become. This bill would alleviate  this encumbrance for associations.” The LAC, she says, will be meeting with the sponsor to clarify this bill and  confirm that community associations will receive the same treatment (exemption)  afforded to residential customers.  

 Two other new bills—titled A3246 and A3247 respectively—could potentially affect many associations. These bills were introduced in the  Assembly Housing and Local Government Committee in October of last year.  

 According to Radcliffe, “The adoption of these two bills will create programs that encourage a  municipality to purchase foreclosed properties for affordable housing use or to  allow a major tax credit for banks and lending institutions that donate  foreclosed real property to municipalities for use as affordable housing. It is  believed that the creation of these programs will assist municipalities in  meeting their affordable housing obligation.”  

 However, Radcliffe continues, “There are many questions that arise with the review of this bill. Can these  programs convert market units to affordable units in existing associations? If  so, what happens to the maintenance fee for that unit? Does the affordable  status expire on the same date as the other affordable units in the  development? These bills are in their early stages, but we’ll be keeping a close eye on them.”  

 And finally, Radcliffe says that A1213 and S1089, or “William’s Law,” were tentatively introduced this past March with the main requirement that all  pool fences be at least five feet high. While most of the newer associations  would be in compliance, many older pools have four-foot fences. “As this could be a major financial burden to associations, the LAC is working to  have current community association fences exempt,” says Radcliffe.  

 The Licensing Question

 The licensing and mandatory training of professionals is an issue that is sure  to raise questions—and just as often, raise debates. Several pieces of legislation in the works  address the issue of licensure and certification.  

 S2477 is the Senate version of A3206, introduced in the Assembly in 2008, and  requires training and registration for in-house security officers, with the  training to be conducted by New Jersey state police. As it was originally  introduced, the bill included HOAs, but according to Radcliffe, was unclear and  applied restrictions and requirements on layers of HOA employees that are not  currently considered security personnel. The LAC monitoring both of these bills and meeting with the appropriate  representatives to negotiate language that would reduce or eliminate the burden  to associations.  

 A new bill, S2302, has been proposed by Sen. Nicholas P. Scutari, D-22, for  licensure of landscape professionals and for the registration of professional  landscape businesses, according to Radcliffe. This bill, as currently drafted,  is opposed by the New Jersey Landscape Contractors Association (NJLCA), and was  referred to the Senate Commerce Committee in October 2008. LAC has reviewed it  and is monitoring its movement in committee.  

 In tough financial times such as these, priorities for homeowners, their  advocates, and lawmakers get rearranged and refocused. “ We have observed that many of the new bills considered by the Senate and  Assembly committees have a recurrent financial theme,” says Radcliffe, “and with the current financial situation, this is very understandable. That  said, our job at CAI and the LAC is to continue to monitor all legislation to  make sure these bills will not negatively impact community associations.” According to Radcliffe and CAI-NJ, one such measure is the development of a  license for community association managers.  

 “While we realize the legislature has dramatic economic circumstances to deal  with, we are determined not to let this issue die,” says Radcliffe. “So CAI has developed a task force to work on this issue and keep it in the  forefront and get our manager licensing bill through the legislature.”  

 Learning More

 Staying current with new laws and legislative items is the responsibility of  both HOA boards and their managers. Of course, The New Jersey Cooperator is an  excellent source for regular updates on legislation and precedent-setting legal  cases, and homeowners and HOA administrators alike can visit the New Jersey  Legislative website at http://www.njleg. state.nj.us at any time to look up  pending or existing legislation on this site. CAI-NJ also publishes a  legislative update in the organization’s monthly Community Trends magazine and on the CAI-NJ website.   

 Hannah Fons is associate editor of The New Jersey Cooperator. Additional research by Managing Editor Debra A. Estock.