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OLR Bill Analysis
sHB 7068
AN ACT CONCERNING COURT -ORDERED ACCOUNTINGS OF
COMMON INTEREST COMMUNITY FINANCIAL RECORDS AND
REVISING THE DISCLOSURE REQUIREMENTS RELATING TO
COMMON INTEREST COMMUNITIES.
SUMMARY
This bill allows, under specific circumstances, a group of unit owners
representing at least 10% of a common interest community association
to petition the Superior Court for an order to direct the association to get
an independent audit of records it must retain (see below) that relate to
the association’s expenditures and any other financial matters.
The bill limits the frequency of these requests to once per 12-month
period and requires the group of unit owners to:
1. certify in writing that they have a good-faith reason for the audit,
2. get the signed opinion of an accountant who specializes in fraud
and financial forensics stating that there is evidence of fraud or
misuse of funds,
3. hold at least 10% of directed or undirected proxies of the unit
owners authorizing the petition, and
4. pay the expenses associated with the audit.
It applies regardless of the association’s bylaws but only as allowed
under the pertinent provisions of the Connecticut Common Interest
Ownership Act (CIOA) (see BACKGROUND) . Under CIOA, an
association must not allow the following documents to be inspected or
copied: (1) someone’s personnel, salary, and medical records, unless he
or she consented to the disclosure; (2) any unredacted papers, ballots,
proxies, or records that identify a vote by unit owner; or (3) any record
that disclosure of it would be a violation of the law. 2025HB-07068-R000749-BA.DOCX
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The bill also expands the information that the Uniform Property
Condition Disclosure Act (see BACKGROUND) requires a seller of
residential property to disclose to the prospective buyer. It does so by
requiring the seller to make a special statement on the residential
condition report that advises the buyer to:
1. get a resale certificate, if the property being sold is in a common
interest community that has more than 12 units, or
2. consult with certain professionals (trade professionals, attorneys,
real estate professionals, and financial analysts) and community
residents for information on issues in common interest
community ownership, if it is in a community that has 12 or less
units (these communities are not required to provide resale
certificates).
EFFECTIVE DATE: October 1, 2025
RECORDS SUBJECT TO AUDIT UND ER THE BILL
If the court requires an audit under the bill, the audit applies to the
following records that a community interest community must retain:
1. detailed records of receipts and expenditures affecting the
association’s operation and administration, and other
appropriate accounting records, including records relating to any
reserve accounts;
2. minutes of unit owner and executive board meetings other than
executive sessions, records of actions taken without a meeting,
and records of actions taken by a committee on the association’s
behalf;
3. the names of unit owners showing the number of votes each unit
owner is entitled to cast;
4. the association’s original or restated organizational documents,
if required by law other than CIOA, bylaws and all its
amendments, and all rules currently in effect; 2025HB-07068-R000749-BA.DOCX
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5. the association’s financial statements and tax returns for the past
three years;
6. a list of the names and addresses of the association’s current
executive board members and officers;
7. the association’s most recent annual report delivered to the
Secretary of the State, if any;
8. financial and other records sufficiently detailed to enable the
association to comply with CIOA’s provision on resale of units;
9. copies of current contracts to which the association is a party;
10. records of executive board or committee actions to approve or
deny any requests for design or architectural approval from unit
owners; and
11. ballots, proxies, and other records related to voting by unit
owners for one year after the election, action, or vote to which
they relate (CGS § 47-260(a)).
Association Records Not Subject to Audit
The bill’s audit provisions do not apply to the following records
retained by an association that the law requires to be withheld from
inspection and copying:
1. individuals’ personnel, salary, and medical records unless
waived by the subject of the record;
2. unredacted paper or electronic ballots, unredacted proxy forms,
and other unredacted records that identify a unit owner’s vote;
or
3. information the disclosure of which would violate any law other
than CIOA (CGS § 47-260(c)).
RESIDENTIAL CONDITION REPORTS EXEMPTIONS
Under existing law, and the bill, the following transactions are 2025HB-07068-R000749-BA.DOCX
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exempt from the residential condition report requirements:
1. any transfer from one or more co-owners solely to one or more of
the co-owners;
2. transfers made to the transferor’s spouse, mother, father, brother,
sister, child, grandparent, or grandchild where no consideration
is paid;
3. transfers of newly-constructed residential real property for
which an implied warranty is provided under law;
4. transfers made by executors, administrators, trustees, or
conservators;
5. transfers by the federal government or any of its political
subdivisions or any corporation, institution, or quasi-
governmental agency chartered by the federal government;
6. transfers by the state or any of its political subdivisions, with
certain exceptions;
7. transfers of property that was the subject of a contract or option
entered into before January 1, 1996; and
8. transfers of property acquired by foreclosure, with certain
exceptions (CGS § 20-327b(b)).
BACKGROUND
Common Interest Ownership Act
CIOA generally governs condominiums and other common interest
communities formed in Connecticut on and after January 1, 1984 (CGS
§ 47-200 et seq.). Several CIOA provisions also apply to common interest
communities created in Connecticut before January 1, 1984, but do not
invalidate existing provisions of the communities’ governing
instruments. Common interest communities created before that date can
amend their governing instruments to conform to portions of CIOA that
do not automatically apply (CGS §§ 47-214, -216 & -218). 2025HB-07068-R000749-BA.DOCX
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Uniform Property Condition Disclosure Act
The Uniform Property Condition Disclosure Act (CGS § 20-327b)
requires a residential property seller to give a residential property
condition report to the prospective buyer before the prospective buyer
executes any binder, contract to purchase, option, or lease with a
purchase option. The Department of Consumer Protection
commissioner sets this form.
COMMITTEE ACTION
Insurance and Real Estate Committee
Joint Favorable Substitute Change of Reference - JUD
Yea 13 Nay 0 (03/13/2025)
Judiciary Committee
Joint Favorable
Yea 40 Nay 1 (04/07/2025)