| 72 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 3.1condominiums created before August 1, 1999, except to the extent that this chapter defers |
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| 73 | | - | 3.2to the declarations, bylaws, CIC plats, or rules and regulations issued under them. |
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| 74 | | - | 3.3 (3) This chapter shall not apply to cooperatives and created prior to June 1, 1994, or |
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| 75 | | - | 3.4created under chapter 308C; to planned communities created prior to June 1, 1994,; or to |
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| 76 | | - | 3.5planned communities that were created on or after June 1, 1994, and before August 1, 2006, |
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| 77 | | - | 3.6and that consist of more than two but fewer than 13 units; except by election pursuant to |
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| 78 | | - | 3.7subsection (d), and except that the following sections apply to all planned communities and |
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| 79 | | - | 3.8townhome associations regardless of when created, unless they are exempt under subsection |
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| 80 | | - | 3.9(e): sections 515B.1-116, subsections (a), (c), (d), and (e),; 515B.3-102, subsections (a), |
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| 81 | | - | 3.10paragraphs (1), (3), (11), and (12), (c), and (g); 515B.3-103, subsections (a), (e), paragraph |
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| 82 | | - | 3.11(4), (g), and (h); 515B.3-107, subsections (a), (d), (e), (f), and (g); 515B.3-115, subsections |
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| 83 | | - | 3.12(e), paragraphs (4) and (5), (g), and (k); 515.3-1151, subsections (e), paragraphs (4) and |
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| 84 | | - | 3.13(5), (g), and (k); 515.3-116, subsections (a) and (h); 515.3-122; 515B.4-107,; and 515B.4-108, |
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| 85 | | - | 3.14apply to all planned communities and cooperatives regardless of when they are created, |
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| 86 | | - | 3.15unless they are exempt under subsection (e). |
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| 87 | | - | 3.16 (c) This chapter shall not invalidate any amendment to the declaration, bylaws or |
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| 88 | | - | 3.17condominium plat of any condominium created under chapter 515 or 515A if the amendment |
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| 89 | | - | 3.18was recorded before June 1, 1994. Any amendment recorded on or after June 1, 1994, shall |
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| 90 | | - | 3.19be adopted in conformity with the procedures and requirements specified by those instruments |
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| 91 | | - | 3.20and by this chapter. If the amendment grants to any person any rights, powers or privileges |
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| 92 | | - | 3.21permitted by this chapter, all correlative obligations, liabilities and restrictions contained |
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| 93 | | - | 3.22in this chapter shall also apply to that person. |
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| 94 | | - | 3.23 (d) Any condominium created under chapter 515, any planned community or cooperative |
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| 95 | | - | 3.24which would be exempt from this chapter under subsection (e), or any planned community |
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| 96 | | - | 3.25or cooperative created prior to June 1, 1994, or any planned community that was created |
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| 97 | | - | 3.26on or after June 1, 1994, and prior to August 1, 2006, and that consists of more than two |
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| 98 | | - | 3.27but fewer than 13 units, may elect to be subject to this chapter, as follows: |
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| 99 | | - | 3.28 (1) The election shall be accomplished by recording a declaration or amended declaration, |
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| 100 | | - | 3.29and a new or amended CIC plat where required, and by approving bylaws or amended |
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| 101 | | - | 3.30bylaws, which conform to the requirements of this chapter, and which, in the case of |
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| 102 | | - | 3.31amendments, are adopted in conformity with the procedures and requirements specified by |
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| 103 | | - | 3.32the existing declaration and bylaws of the common interest community, and by any applicable |
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| 104 | | - | 3.33statutes. |
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| 105 | | - | 3Article 1 Section 1. |
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| 106 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 4.1 (2) In a condominium, the preexisting condominium plat shall be the CIC plat and an |
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| 107 | | - | 4.2amended CIC plat shall be required only if the amended declaration or bylaws contain |
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| 108 | | - | 4.3provisions inconsistent with the preexisting condominium plat. The condominium's CIC |
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| 109 | | - | 4.4number shall be the apartment ownership number or condominium number originally |
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| 110 | | - | 4.5assigned to it by the recording officer. In a cooperative in which the unit owners' interests |
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| 111 | | - | 4.6are characterized as real estate, a CIC plat shall be required. In a planned community, the |
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| 112 | | - | 4.7preexisting plat or registered land survey recorded pursuant to chapter 505, 508, or 508A, |
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| 113 | | - | 4.8or the part of the plat or registered land survey upon which the common interest community |
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| 114 | | - | 4.9is located, shall be the CIC plat. |
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| 115 | | - | 4.10 (3) The amendment shall comply with section 515B.2-118(a)(3) and (c); except that the |
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| 116 | | - | 4.11unanimous consent of the unit owners shall not be required for (i) a clarification of the unit |
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| 117 | | - | 4.12boundary description if the clarified boundary description is substantially consistent with |
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| 118 | | - | 4.13the preexisting CIC plat, or (ii) changes from common elements to limited common elements |
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| 119 | | - | 4.14that occur by operation of section 515B.2-109(c) and (d). |
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| 120 | | - | 4.15 (4) Except as permitted by paragraph (3), no declarant, affiliate of declarant, association, |
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| 121 | | - | 4.16master association nor unit owner may acquire, increase, waive, reduce or revoke any |
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| 122 | | - | 4.17previously existing warranty rights or causes of action that one of said persons has against |
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| 123 | | - | 4.18any other of said persons by reason of exercising the right of election under this subsection. |
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| 124 | | - | 4.19 (5) A common interest community which elects to be subject to this chapter may, as a |
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| 125 | | - | 4.20part of the election process, change its form of ownership by complying with section |
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| 126 | | - | 4.21515B.2-123. |
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| 127 | | - | 4.22 (e) Except as otherwise provided in this subsection, this chapter shall not apply, except |
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| 128 | | - | 4.23by election pursuant to subsection (d), to the following: |
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| 129 | | - | 4.24 (1) a planned community which consists of two units, which utilizes a CIC plat complying |
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| 130 | | - | 4.25with section 515B.2-110(d)(1) and (2), or section 515B.2-1101(d)(1) and (2), which is not |
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| 131 | | - | 4.26subject to any rights to subdivide or convert units or to add additional real estate, and which |
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| 132 | | - | 4.27is not subject to a master association; |
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| 133 | | - | 4.28 (2) a common interest community that consists solely of platted lots or other separate |
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| 134 | | - | 4.29parcels of real estate designed or utilized for detached single family dwellings or agricultural |
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| 135 | | - | 4.30purposes, with or without common property, where no association or master association |
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| 136 | | - | 4.31has an obligation to maintain any building containing a dwelling or any agricultural building |
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| 137 | | - | 4.32located or to be located on such platted lots or parcels; except that section 515B.4-101(e) |
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| 138 | | - | 4.33shall apply to the sale of such platted lots or parcels of real estate if the common interest |
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| 139 | | - | 4.34community is or will be subject to a master declaration; |
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| 140 | | - | 4Article 1 Section 1. |
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| 141 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 5.1 (3) a cooperative where, at the time of creation of the cooperative, the unit owners' |
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| 142 | | - | 5.2interests in the dwellings as described in the declaration consist solely of proprietary leases |
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| 143 | | - | 5.3having an unexpired term of fewer than 20 years, including renewal options; |
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| 144 | | - | 5.4 (4) planned communities utilizing a CIC plat complying with section 515B.2-110(d)(1) |
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| 145 | | - | 5.5and (2), or section 515B.2-1101(d)(1) and (2), and cooperatives, which are limited by the |
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| 146 | | - | 5.6declaration to nonresidential uses; or |
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| 147 | | - | 5.7 (5) real estate subject only to an instrument or instruments filed primarily for the purpose |
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| 148 | | - | 5.8of creating or modifying rights with respect to access, utilities, parking, ditches, drainage, |
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| 149 | | - | 5.9or irrigation. |
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| 150 | | - | 5.10 (f) Section 515B.4-101(e) applies to any platted lot or other parcel of real estate that is |
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| 151 | | - | 5.11subject to a master declaration and is not subject to or is exempt from this chapter. |
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| 152 | | - | 5.12 (g) Section 515B.1-106 and section 515B.2-118, subsections (a)(5), (a)(7), and (d), shall |
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| 153 | | - | 5.13apply to all common interest communities. |
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| 154 | | - | 5.14 (h) Sections 515B.1-103(33a), 515B.2-110, 515B.3-105, 515B.3-115, 515B.4-102, and |
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| 155 | | - | 5.15515B.4-115 apply only to common interest communities created before August 1, 2010. |
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| 156 | | - | 5.16Sections 515B.1-103(33b), 515B.2-1101, 515B.3-1051, 515B.3-1151, 515B.4-1021, and |
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| 157 | | - | 5.17515B.4-1151 apply only to common interest communities created on or after August 1, |
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| 158 | | - | 5.182010. |
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| 159 | | - | 5.19 (i) Section 515B.3-114 applies to common interest communities only for the association's |
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| 160 | | - | 5.20fiscal years commencing before January 1, 2012. Section 515B.3-1141 applies to common |
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| 161 | | - | 5.21interest communities only for the association's fiscal years commencing on or after January |
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| 162 | | - | 5.221, 2012. |
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| 163 | | - | 5.23 (j) Section 515B.3-104 applies only to transfers of special declarant rights that are |
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| 164 | | - | 5.24effective before August 1, 2010. Section 515B.3-1041, subsections (a) through (i), apply |
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| 165 | | - | 5.25only to transfers of special declarant rights that are effective on or after August 1, 2010. |
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| 166 | | - | 5.26Section 515B.3-1041, subsections (j) and (k), apply only to special declarant rights reserved |
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| 167 | | - | 5.27in a declaration that is first recorded on or after August 1, 2010. |
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| 168 | | - | 5.28 EFFECTIVE DATE.This section is effective January 1, 2026. |
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| 169 | | - | 5.29 Sec. 2. Minnesota Statutes 2024, section 515B.2-103, is amended to read: |
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| 170 | | - | 5.30 515B.2-103 CONSTRUCTION AND VALIDITY OF DECLARATION AND |
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| 171 | | - | 5.31BYLAWS. |
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| 172 | | - | 5.32 (a) All provisions of the declaration and bylaws are severable. |
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| 173 | | - | 5Article 1 Sec. 2. |
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| 174 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 6.1 (b) The rule against perpetuities may not be applied to defeat any provision of the |
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| 175 | | - | 6.2declaration or this chapter, or any instrument executed pursuant to the declaration or this |
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| 176 | | - | 6.3chapter. |
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| 177 | | - | 6.4 (c) In the event of a conflict between the provisions of the declaration and the bylaws, |
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| 178 | | - | 6.5the declaration prevails except to the extent that the declaration is inconsistent with this |
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| 179 | | - | 6.6chapter. In the event of a conflict between the provisions of the declaration or the bylaws |
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| 180 | | - | 6.7and this chapter, this chapter prevails. |
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| 181 | | - | 6.8 (d) The declaration and bylaws must comply with sections 500.215, 500.216, and 500.217. |
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| 182 | | - | 6.9 EFFECTIVE DATE.This section is effective January 1, 2026. |
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| 183 | | - | 6.10 Sec. 3. Minnesota Statutes 2024, section 515B.2-119, is amended to read: |
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| 184 | | - | 6.11 515B.2-119 TERMINATION OF COMMON INTEREST COMMUNITY . |
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| 185 | | - | 6.12 (a) Except as otherwise provided in this chapter, a common interest community may be |
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| 186 | | - | 6.13terminated as follows: |
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| 187 | | - | 6.14 (1) if the common interest community does not own any common elements, the common |
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| 188 | | - | 6.15interest community may be terminated only by agreement of unit owners of units to which |
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| 189 | | - | 6.16at least 60 percent of the votes in the association are allocated; or |
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| 190 | | - | 6.17 (2) if the common interest community owns common elements, the common interest |
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| 191 | | - | 6.18community may be terminated only by agreement of unit owners of units to which at least |
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| 192 | | - | 6.1980 percent of the votes in the association are allocated, and 80 percent of the first mortgagees |
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| 193 | | - | 6.20of units (each mortgagee having one vote per unit financed), or any larger percentage the |
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| 194 | | - | 6.21declaration specifies. The declaration may specify a smaller percentage only if all of the |
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| 195 | | - | 6.22units are single-family homes or if all of the units are restricted to nonresidential use. |
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| 196 | | - | 6.23 (b) An agreement to terminate shall be evidenced by a written agreement, executed in |
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| 197 | | - | 6.24the same manner as a deed by the number of unit owners and first mortgagees of units |
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| 198 | | - | 6.25required by subsection (a), and shall contain and include property and interest transfers, |
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| 199 | | - | 6.26including easements or sales, for any common elements. The agreement shall specify a date |
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| 200 | | - | 6.27after which the agreement shall be void unless recorded before that date. The agreement |
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| 201 | | - | 6.28shall also specify a date by which the termination of the common interest community and |
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| 202 | | - | 6.29the winding up of its affairs must be accomplished. A certificate of termination executed |
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| 203 | | - | 6.30by the association evidencing the termination shall be recorded on or before the termination |
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| 204 | | - | 6.31date, or the agreement to terminate shall be revoked. The agreement to terminate, or a |
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| 205 | | - | 6.32memorandum thereof, and the certificate of termination shall be recorded in every county |
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| 206 | | - | 6Article 1 Sec. 3. |
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| 207 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 7.1in which a portion of the common interest community is situated and is effective only upon |
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| 208 | | - | 7.2recording. |
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| 209 | | - | 7.3 (c) In the case of a condominium or planned community containing only units having |
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| 210 | | - | 7.4upper and lower boundaries, a termination agreement may provide that all of the common |
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| 211 | | - | 7.5elements and units of the common interest community must be sold following termination. |
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| 212 | | - | 7.6If, pursuant to the agreement, any real estate in the common interest community is to be |
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| 213 | | - | 7.7sold following termination, the termination agreement shall set forth the minimum terms |
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| 214 | | - | 7.8of sale acceptable to the association. |
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| 215 | | - | 7.9 (d) In the case of a condominium or planned community containing any units not having |
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| 216 | | - | 7.10upper and lower boundaries, a termination agreement may provide for sale of the common |
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| 217 | | - | 7.11elements, but it may not require that the units be sold following termination, unless the |
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| 218 | | - | 7.12original declaration provided otherwise or all unit owners whose units are to be sold consent |
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| 219 | | - | 7.13to the sale. |
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| 220 | | - | 7.14 (e) The association, on behalf of the unit owners, shall have authority to contract for the |
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| 221 | | - | 7.15sale of real estate in a common interest community pursuant to this section, subject to the |
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| 222 | | - | 7.16required approval. The agreement to terminate shall be deemed to grant to the association |
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| 223 | | - | 7.17a power of attorney coupled with an interest to effect the conveyance of the real estate on |
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| 224 | | - | 7.18behalf of the holders of all interests in the units, including without limitation the power to |
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| 225 | | - | 7.19execute all instruments of conveyance and related instruments. Until the sale has been |
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| 226 | | - | 7.20completed, all instruments in connection with the sale have been executed and the sale |
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| 227 | | - | 7.21proceeds distributed, the association shall continue in existence with all powers it had before |
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| 228 | | - | 7.22termination. |
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| 229 | | - | 7.23 (1) The instrument conveying or creating the interest in the common interest community |
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| 230 | | - | 7.24shall include as exhibits (i) an affidavit of the secretary of the association certifying that the |
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| 231 | | - | 7.25approval required by this section has been obtained and (ii) a schedule of the names of all |
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| 232 | | - | 7.26unit owners in the common interest community as of the date of the approval. |
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| 233 | | - | 7.27 (2) Proceeds of the sale shall be distributed to unit owners and secured parties as their |
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| 234 | | - | 7.28interests may appear, in accordance with subsections (h), (i), (j), and (k). |
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| 235 | | - | 7.29 (3) Unless otherwise specified in the agreement of termination, until the association has |
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| 236 | | - | 7.30conveyed title to the real estate, each unit owner and the unit owner's successors in interest |
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| 237 | | - | 7.31have an exclusive right to occupancy of the portion of the real estate that formerly constituted |
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| 238 | | - | 7.32the unit. During the period of that occupancy, each unit owner and the unit owner's successors |
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| 239 | | - | 7.33in interest remain liable for all assessments and other obligations imposed on unit owners |
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| 240 | | - | 7.34by this chapter, the declaration or the bylaws. |
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| 241 | | - | 7Article 1 Sec. 3. |
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| 242 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 8.1 (f) The legal description of the real estate constituting the common interest community |
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| 243 | | - | 8.2shall, upon the date of recording of the certificate of termination referred to in subsection |
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| 244 | | - | 8.3(b), be as follows: |
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| 245 | | - | 8.4 (1) In a planned community utilizing a CIC plat complying with section 515B.2-110(d)(1) |
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| 246 | | - | 8.5and (2), the lot and block description contained in the CIC plat, and any amendments thereto, |
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| 247 | | - | 8.6subject to any subsequent conveyance or taking of a fee interest in any part of the property. |
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| 248 | | - | 8.7 (2) In a condominium or cooperative, or a planned community utilizing a CIC plat |
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| 249 | | - | 8.8complying with section 515B.2-110(c), the underlying legal description of the real estate |
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| 250 | | - | 8.9as set forth in the declaration creating the common interest community, and any amendments |
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| 251 | | - | 8.10thereto, subject to any subsequent conveyance or taking of a fee interest in any part of the |
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| 252 | | - | 8.11property. |
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| 253 | | - | 8.12 (3) The legal description referred to in this subsection shall apply upon the recording of |
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| 254 | | - | 8.13the certificate of termination. The recording officer for each county in which the common |
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| 255 | | - | 8.14interest community is located shall index the property located in that county in its records |
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| 256 | | - | 8.15under the legal description required by this subsection from and after the date of recording |
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| 257 | | - | 8.16of the certificate of termination. In the case of registered property, the registrar of titles shall |
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| 258 | | - | 8.17cancel the existing certificates of title with respect to the property and issue one or more |
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| 259 | | - | 8.18certificates of title for the property utilizing the legal description required by this subsection. |
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| 260 | | - | 8.19 (g) In a condominium or planned community, if the agreement to terminate provides |
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| 261 | | - | 8.20that the real estate constituting the common interest community is not to be sold following |
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| 262 | | - | 8.21termination, title to the common elements and, in a common interest community containing |
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| 263 | | - | 8.22only units having upper and lower boundaries described in the declaration, title to all the |
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| 264 | | - | 8.23real estate in the common interest community, vests in the unit owners upon termination as |
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| 265 | | - | 8.24tenants in common in proportion to their respective interest as provided in subsection (k), |
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| 266 | | - | 8.25and liens on the units shift accordingly. While the tenancy in common exists, each unit |
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| 267 | | - | 8.26owner and the unit owner's successors in interest have an exclusive right to occupancy of |
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| 268 | | - | 8.27the portion of the real estate that formerly constituted the unit. |
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| 269 | | - | 8.28 (h) The proceeds of any sale of real estate pursuant to subsection (e), together with the |
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| 270 | | - | 8.29assets of the association, shall be held by the association as trustee for unit owners, secured |
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| 271 | | - | 8.30parties and other holders of liens on the units as their interests may appear. Before distributing |
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| 272 | | - | 8.31any proceeds, the association shall have authority to deduct from the proceeds of sale due |
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| 273 | | - | 8.32with respect to the unit (i) unpaid assessments levied by the association with respect to the |
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| 274 | | - | 8.33unit, (ii) unpaid real estate taxes or special assessments due with respect to the unit, and |
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| 275 | | - | 8Article 1 Sec. 3. |
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| 276 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 9.1(iii) the share of expenses of sale and winding up of the association's affairs with respect to |
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| 277 | | - | 9.2the unit. |
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| 278 | | - | 9.3 (i) Following termination of a condominium or planned community, creditors of the |
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| 279 | | - | 9.4association holding liens on the units perfected before termination may enforce those liens |
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| 280 | | - | 9.5in the same manner as any lienholder, in order of priority based upon their times of perfection. |
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| 281 | | - | 9.6All other creditors of the association are to be treated as if they had perfected liens on the |
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| 282 | | - | 9.7units immediately before termination. |
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| 283 | | - | 9.8 (j) In a cooperative, the declaration may provide that all creditors of the association have |
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| 284 | | - | 9.9priority over any interests of unit owners and creditors of unit owners. In that event, following |
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| 285 | | - | 9.10termination, creditors of the association holding liens on the cooperative which were perfected |
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| 286 | | - | 9.11before termination may enforce their liens in the same manner as any lienholder, in order |
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| 287 | | - | 9.12of priority based upon their times of perfection. All other creditors of the association shall |
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| 288 | | - | 9.13be treated as if they had perfected a lien against the cooperative immediately before |
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| 289 | | - | 9.14termination. Unless the declaration provides that all creditors of the association have that |
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| 290 | | - | 9.15priority: |
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| 291 | | - | 9.16 (1) the lien of each creditor of the association which was perfected against the association |
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| 292 | | - | 9.17before termination becomes, upon termination, a lien against each unit owner's interest in |
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| 293 | | - | 9.18the unit as of the date the lien was perfected; |
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| 294 | | - | 9.19 (2) any other creditor of the association is to be treated upon termination as if the creditor |
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| 295 | | - | 9.20had perfected a lien against each unit owner's interest immediately before termination; |
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| 296 | | - | 9.21 (3) the amount of the lien of an association's creditor described in paragraphs (1) and |
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| 297 | | - | 9.22(2) against each of the unit owners' interest shall be proportionate to the ratio which each |
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| 298 | | - | 9.23unit's common expense liability bears to the common expense liability of all of the units; |
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| 299 | | - | 9.24 (4) the lien of each creditor of each unit owner which was perfected before termination |
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| 300 | | - | 9.25continues as a lien against that unit owner's interest in the unit as of the date the lien was |
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| 301 | | - | 9.26perfected; and |
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| 302 | | - | 9.27 (5) the assets of the association shall be distributed to all unit owners and all lienholders |
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| 303 | | - | 9.28as their interests may appear in the order described in this section. Creditors of the association |
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| 304 | | - | 9.29are not entitled to payment from any unit owner in excess of the amount of the creditor's |
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| 305 | | - | 9.30lien against that unit owner's interest. |
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| 306 | | - | 9.31 (k) The respective interest of unit owners referred to in subsections (e), (f), (g), (h) and |
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| 307 | | - | 9.32(i) are as follows: |
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| 308 | | - | 9Article 1 Sec. 3. |
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| 309 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 10.1 (1) Except as provided in paragraph (2), the respective interests of unit owners are the |
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| 310 | | - | 10.2fair market values of their units, allocated interests, and any limited common elements |
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| 311 | | - | 10.3immediately before the termination, as determined by one or more independent appraisers |
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| 312 | | - | 10.4selected by the association. The decision of the independent appraisers must be distributed |
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| 313 | | - | 10.5to the unit owners and becomes final unless disapproved within 30 days after distribution |
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| 314 | | - | 10.6by unit owners of units to which 25 percent of the votes in the association are allocated. |
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| 315 | | - | 10.7The proportion of any unit's interest to that of all units is determined by dividing the fair |
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| 316 | | - | 10.8market value of that unit by the total fair market values of all the units. |
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| 317 | | - | 10.9 (2) If any unit or any limited common element is destroyed to the extent that an appraisal |
|---|
| 318 | | - | 10.10of the fair market value thereof before destruction cannot be made, the interests of all unit |
|---|
| 319 | | - | 10.11owners shall be measured by: (i) in a condominium, their allocations of common element |
|---|
| 320 | | - | 10.12interests immediately before the termination, (ii) in a cooperative, their respective ownership |
|---|
| 321 | | - | 10.13interests immediately before the termination, and (iii) in a planned community, their |
|---|
| 322 | | - | 10.14respective allocations of common expenses immediately before the termination. |
|---|
| 323 | | - | 10.15 (l) In a condominium or planned community, except as provided in subsection (m), |
|---|
| 324 | | - | 10.16foreclosure or enforcement of a lien or encumbrance against the entire common interest |
|---|
| 325 | | - | 10.17community does not terminate, of itself, the common interest community, and foreclosure |
|---|
| 326 | | - | 10.18or enforcement of a lien or encumbrance against a portion of the common interest community |
|---|
| 327 | | - | 10.19does not withdraw that portion from the common interest community. |
|---|
| 328 | | - | 10.20 (m) In a condominium or planned community, if a lien or encumbrance against a portion |
|---|
| 329 | | - | 10.21of the real estate comprising the common interest community has priority over the declaration |
|---|
| 330 | | - | 10.22and the lien or encumbrance has not been partially released, the parties foreclosing the lien |
|---|
| 331 | | - | 10.23or encumbrance, upon foreclosure, may record an instrument excluding the real estate subject |
|---|
| 332 | | - | 10.24to that lien or encumbrance from the common interest community. |
|---|
| 333 | | - | 10.25 (n) Following the termination of a common interest community in accordance with this |
|---|
| 334 | | - | 10.26section, the association shall be dissolved in accordance with law. |
|---|
| 335 | | - | 10.27 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 336 | | - | 10.28Sec. 4. Minnesota Statutes 2024, section 515B.3-102, is amended to read: |
|---|
| 337 | | - | 10.29 515B.3-102 POWERS AND DUTIES OF UNIT OWNERS' ASSOCIATION. |
|---|
| 338 | | - | 10.30 (a) Except as provided in subsections (b), (c), (d), (e), and (f) and subject to the provisions |
|---|
| 339 | | - | 10.31of the declaration or bylaws, the association shall have the power to: |
|---|
| 340 | | - | 10.32 (1) adopt, amend and revoke rules and regulations not inconsistent with the articles of |
|---|
| 341 | | - | 10.33incorporation, bylaws and declaration, and consistent with the requirements of subsection |
|---|
| 342 | | - | 10Article 1 Sec. 4. |
|---|
| 343 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 11.1(g) as follows: (i) regulating the use of the common elements; (ii) regulating the use of the |
|---|
| 344 | | - | 11.2units, and conduct of unit occupants, which may jeopardize the health, safety or welfare of |
|---|
| 345 | | - | 11.3other occupants, which involves noise or other disturbing activity, or which may damage |
|---|
| 346 | | - | 11.4the common elements or other units; (iii) regulating or prohibiting animals; (iv) regulating |
|---|
| 347 | | - | 11.5changes in the appearance of the common elements and conduct which may damage the |
|---|
| 348 | | - | 11.6common interest community; (v) regulating the exterior appearance of the common interest |
|---|
| 349 | | - | 11.7community, including, for example, balconies and patios, window treatments, and signs |
|---|
| 350 | | - | 11.8and other displays, regardless of whether inside a unit; (vi) implementing the articles of |
|---|
| 351 | | - | 11.9incorporation, declaration and bylaws, and exercising the powers granted by this section; |
|---|
| 352 | | - | 11.10and (vii) otherwise facilitating the operation of the common interest community; |
|---|
| 353 | | - | 11.11 (2) adopt and amend budgets for revenues, expenditures and reserves, and levy and |
|---|
| 354 | | - | 11.12collect assessments for common expenses from unit owners; |
|---|
| 355 | | - | 11.13 (3) hire and discharge managing agents and other employees, agents, and independent |
|---|
| 356 | | - | 11.14contractors; |
|---|
| 357 | | - | 11.15 (4) institute, defend, or intervene in litigation or administrative proceedings (i) in its |
|---|
| 358 | | - | 11.16own name on behalf of itself or two or more unit owners on matters affecting the common |
|---|
| 359 | | - | 11.17elements or other matters affecting the common interest community or, (ii) with the consent |
|---|
| 360 | | - | 11.18of the owners of the affected units on matters affecting only those units; |
|---|
| 361 | | - | 11.19 (5) make contracts and incur liabilities; |
|---|
| 362 | | - | 11.20 (6) regulate the use, maintenance, repair, replacement, and modification of the common |
|---|
| 363 | | - | 11.21elements and the units; |
|---|
| 364 | | - | 11.22 (7) cause improvements to be made as a part of the common elements, and, in the case |
|---|
| 365 | | - | 11.23of a cooperative, the units; |
|---|
| 366 | | - | 11.24 (8) acquire, hold, encumber, and convey in its own name any right, title, or interest to |
|---|
| 367 | | - | 11.25real estate or personal property, but (i) common elements in a condominium or planned |
|---|
| 368 | | - | 11.26community may be conveyed or subjected to a security interest only pursuant to section |
|---|
| 369 | | - | 11.27515B.3-112, or (ii) part of a cooperative may be conveyed, or all or part of a cooperative |
|---|
| 370 | | - | 11.28may be subjected to a security interest, only pursuant to section 515B.3-112; |
|---|
| 371 | | - | 11.29 (9) grant or amend easements for public utilities, public rights-of-way or other public |
|---|
| 372 | | - | 11.30purposes, and cable television or other communications, through, over or under the common |
|---|
| 373 | | - | 11.31elements; grant or amend easements, leases, or licenses to unit owners for purposes authorized |
|---|
| 374 | | - | 11.32by the declaration; and, subject to approval by a vote of unit owners other than declarant |
|---|
| 375 | | - | 11Article 1 Sec. 4. |
|---|
| 376 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 12.1or its affiliates, grant or amend other easements, leases, and licenses through, over or under |
|---|
| 377 | | - | 12.2the common elements; |
|---|
| 378 | | - | 12.3 (10) impose and receive any payments, fees, or charges for the use, rental, or operation |
|---|
| 379 | | - | 12.4of the common elements, other than limited common elements, and for services provided |
|---|
| 380 | | - | 12.5to unit owners. The association must compile and provide to every unit owner a schedule |
|---|
| 381 | | - | 12.6of the fees and charges that may be imposed; |
|---|
| 382 | | - | 12.7 (11) impose interest and a late charges fee for late payment of assessments, provided |
|---|
| 383 | | - | 12.8that an association may not impose a late fee in excess of $15; may not impose, for a special |
|---|
| 384 | | - | 12.9assessment, an amount greater than five percent of the amount owed or more than $100, |
|---|
| 385 | | - | 12.10whichever is lower; and, after notice and an opportunity to be heard before the board or a |
|---|
| 386 | | - | 12.11committee appointed by it, levy reasonable fines for violations of the declaration, bylaws, |
|---|
| 387 | | - | 12.12and rules and regulations of the association as specified in subsection (c), provided that |
|---|
| 388 | | - | 12.13attorney fees and costs must not be charged or collected from a unit owner who disputes or |
|---|
| 389 | | - | 12.14questions a fine or assessment and, if after the homeowner requests a hearing and a hearing |
|---|
| 390 | | - | 12.15is held by the board or a committee of the board, the board does not adopt a resolution |
|---|
| 391 | | - | 12.16levying the fine or upholding the assessment against the unit owner or owner's unit; |
|---|
| 392 | | - | 12.17 (12) impose reasonable charges for the review, preparation and recordation of |
|---|
| 393 | | - | 12.18amendments to the declaration, or resale certificates required by section 515B.4-107, |
|---|
| 394 | | - | 12.19statements of unpaid assessments, or furnishing copies of association records provided that |
|---|
| 395 | | - | 12.20the association may not impose any charges, including attorney fees, to respond to a question |
|---|
| 396 | | - | 12.21about any governing document or any aspect of the operation or management of the common |
|---|
| 397 | | - | 12.22interest community posed by a unit owner to the association; |
|---|
| 398 | | - | 12.23 (13) provide for the indemnification of its officers and directors, and maintain directors' |
|---|
| 399 | | - | 12.24and officers' liability insurance; |
|---|
| 400 | | - | 12.25 (14) provide for reasonable procedures governing the conduct of meetings and election |
|---|
| 401 | | - | 12.26of directors; and |
|---|
| 402 | | - | 12.27 (15) exercise any other powers conferred by law, or by the declaration, articles of |
|---|
| 403 | | - | 12.28incorporation or bylaws; and. |
|---|
| 404 | | - | 12.29 (16) exercise any other powers necessary and proper for the governance and operation |
|---|
| 405 | | - | 12.30of the association. |
|---|
| 406 | | - | 12.31 (b) Notwithstanding subsection (a) the declaration or bylaws may not impose limitations |
|---|
| 407 | | - | 12.32on the power of the association to deal with the declarant which are more restrictive than |
|---|
| 408 | | - | 12.33the limitations imposed on the power of the association to deal with other persons. |
|---|
| 409 | | - | 12Article 1 Sec. 4. |
|---|
| 410 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 13.1 (c) An association must adopt and provide to every unit owner a policy regarding fines |
|---|
| 411 | | - | 13.2that includes a list of the violations for which a fine may be imposed and a schedule of fines |
|---|
| 412 | | - | 13.3for those violations. When a violation can be cured without causing damage to property or |
|---|
| 413 | | - | 13.4to another, the association must provide the unit owner with a reasonable time to correct |
|---|
| 414 | | - | 13.5the violation before a fine may be imposed. A fine levied pursuant to subsection (a)(11), |
|---|
| 415 | | - | 13.6must be commensurate with the violation and must not exceed $100 for a single violation, |
|---|
| 416 | | - | 13.7except, when the violation is a repeated, willful, and knowing violation and the owner has |
|---|
| 417 | | - | 13.8been given notice that the fine will be increased due to the repeated nature of the violation, |
|---|
| 418 | | - | 13.9the fine may be up to $300. When combined with additional fines for an ongoing violation, |
|---|
| 419 | | - | 13.10late fees, and other allowable charges, the fine must not exceed $2,500 in total for the |
|---|
| 420 | | - | 13.11violation. An association that levies a fine pursuant to subsection (a)(11), or an assessment |
|---|
| 421 | | - | 13.12pursuant to section 515B.3-115(g), or 515B.3-1151(g), must provide a dated, written notice |
|---|
| 422 | | - | 13.13to a unit owner that: |
|---|
| 423 | | - | 13.14 (1) states the amount and reason for the fine or assessment; |
|---|
| 424 | | - | 13.15 (2) for fines levied under section 515B.3-102(a)(11), specifies: (i) the violation for which |
|---|
| 425 | | - | 13.16a fine is being levied and the date of the levy; and (ii) the specific section of the declaration, |
|---|
| 426 | | - | 13.17bylaws, rules, or regulations allegedly violated; |
|---|
| 427 | | - | 13.18 (3) for assessments levied under section 515B.3-115(g) or 515B.3-1151(g), identifies: |
|---|
| 428 | | - | 13.19(i) the damage caused; and (ii) the act or omission alleged to have caused the damage; |
|---|
| 429 | | - | 13.20 (4) states that all unpaid fines and assessments are liens which, if not satisfied, could |
|---|
| 430 | | - | 13.21lead to foreclosure of the lien against the owner's unit; |
|---|
| 431 | | - | 13.22 (5) describes the unit owner's right to be heard by the board or a committee appointed |
|---|
| 432 | | - | 13.23by the board and the procedures for disputing the fine; |
|---|
| 433 | | - | 13.24 (6) states that if the assessment, fine, late fees, and other allowable charges are not paid, |
|---|
| 434 | | - | 13.25the amount may increase as a result of the imposition of attorney fees and other collection |
|---|
| 435 | | - | 13.26costs; and |
|---|
| 436 | | - | 13.27 (7) informs the unit owner that homeownership assistance is available from the Minnesota |
|---|
| 437 | | - | 13.28Homeownership Center. |
|---|
| 438 | | - | 13.29 (d) Notwithstanding subsection (a), powers exercised under this section must comply |
|---|
| 439 | | - | 13.30with sections 500.215, 500.216, and 500.217. |
|---|
| 440 | | - | 13.31 (e) Notwithstanding subsection (a)(4) or any other provision of this chapter, the |
|---|
| 441 | | - | 13.32association, before instituting litigation or arbitration involving construction defect claims |
|---|
| 442 | | - | 13.33against a development party, shall: |
|---|
| 443 | | - | 13Article 1 Sec. 4. |
|---|
| 444 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 14.1 (1) mail or deliver written notice of the anticipated commencement of the action to each |
|---|
| 445 | | - | 14.2unit owner at the addresses, if any, established for notices to owners in the declaration and, |
|---|
| 446 | | - | 14.3if the declaration does not state how notices are to be given to owners, to the owner's last |
|---|
| 447 | | - | 14.4known address. The notice shall specify the nature of the construction defect claims to be |
|---|
| 448 | | - | 14.5alleged, the relief sought, and the manner in which the association proposes to fund the cost |
|---|
| 449 | | - | 14.6of pursuing the construction defect claims; and |
|---|
| 450 | | - | 14.7 (2) obtain the approval of owners of units to which a majority of the total votes in the |
|---|
| 451 | | - | 14.8association are allocated. Votes allocated to units owned by the declarant, an affiliate of the |
|---|
| 452 | | - | 14.9declarant, or a mortgagee who obtained ownership of the unit through a foreclosure sale |
|---|
| 453 | | - | 14.10are excluded. The association may obtain the required approval by a vote at an annual or |
|---|
| 454 | | - | 14.11special meeting of the members or, if authorized by the statute under which the association |
|---|
| 455 | | - | 14.12is created and taken in compliance with that statute, by a vote of the members taken by |
|---|
| 456 | | - | 14.13electronic means or mailed ballots. If the association holds a meeting and voting by electronic |
|---|
| 457 | | - | 14.14means or mailed ballots is authorized by that statute, the association shall also provide for |
|---|
| 458 | | - | 14.15voting by those methods. Section 515B.3-110(c) applies to votes taken by electronic means |
|---|
| 459 | | - | 14.16or mailed ballots, except that the votes must be used in combination with the vote taken at |
|---|
| 460 | | - | 14.17a meeting and are not in lieu of holding a meeting, if a meeting is held, and are considered |
|---|
| 461 | | - | 14.18for purposes of determining whether a quorum was present. Proxies may not be used for a |
|---|
| 462 | | - | 14.19vote taken under this paragraph unless the unit owner executes the proxy after receipt of |
|---|
| 463 | | - | 14.20the notice required under subsection (e)(1) and the proxy expressly references this notice. |
|---|
| 464 | | - | 14.21 (f) The association may intervene in a litigation or arbitration involving a construction |
|---|
| 465 | | - | 14.22defect claim or assert a construction defect claim as a counterclaim, crossclaim, or third-party |
|---|
| 466 | | - | 14.23claim before complying with subsections (e)(1) and (e)(2) but the association's complaint |
|---|
| 467 | | - | 14.24in an intervention, counterclaim, crossclaim, or third-party claim shall be dismissed without |
|---|
| 468 | | - | 14.25prejudice unless the association has complied with the requirements of subsection (e) within |
|---|
| 469 | | - | 14.2690 days of the association's commencement of the complaint in an intervention or the |
|---|
| 470 | | - | 14.27assertion of the counterclaim, crossclaim, or third-party claim. |
|---|
| 471 | | - | 14.28 (g) Rules and regulations adopted must not be arbitrary or capricious and must otherwise |
|---|
| 472 | | - | 14.29be reasonable. An association must give unit owners 60 days' advance notice of a board's |
|---|
| 473 | | - | 14.30intention to adopt a new rule, or amend or revoke a rule. A rule change must be approved |
|---|
| 474 | | - | 14.31at a board meeting, and an association must give homeowners the opportunity to comment |
|---|
| 475 | | - | 14.32on the proposed rule change at the meeting at which the change is considered. Any rule in |
|---|
| 476 | | - | 14.33effect may be revoked by a majority vote of the unit owners at a board meeting, where unit |
|---|
| 477 | | - | 14.34owners may vote in person, by a written statement signed and dated by the unit owner prior |
|---|
| 478 | | - | 14.35to the meeting at which revocation is considered, or by proxy. |
|---|
| 479 | | - | 14Article 1 Sec. 4. |
|---|
| 480 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 15.1 (h) Each association must adopt procedures for dispute resolution and the meet and |
|---|
| 481 | | - | 15.2confer process as provided under section 515B.3-122. |
|---|
| 482 | | - | 15.3 (i) Associations must not sell or assign any debt owed by a unit owner. |
|---|
| 483 | | - | 15.4 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 484 | | - | 15.5 Sec. 5. Minnesota Statutes 2024, section 515B.3-103, is amended to read: |
|---|
| 485 | | - | 15.6 515B.3-103 BOARD OF DIRECTORS, OFFICERS AND DECLARANT |
|---|
| 486 | | - | 15.7CONTROL. |
|---|
| 487 | | - | 15.8 (a) An association shall be governed by a board of directors whose appointment or |
|---|
| 488 | | - | 15.9election shall occur no later than the date of creation of the common interest community |
|---|
| 489 | | - | 15.10and shall be reflected in the association's records. Except as expressly prohibited by the |
|---|
| 490 | | - | 15.11declaration, the articles of incorporation, bylaws, subsection (b), or other provisions of this |
|---|
| 491 | | - | 15.12chapter, the board may act in all instances on behalf of the association. In the performance |
|---|
| 492 | | - | 15.13of their duties, the officers and directors are required to exercise (i) if appointed by the |
|---|
| 493 | | - | 15.14declarant, the care required of fiduciaries of the unit owners and (ii) if elected by the unit |
|---|
| 494 | | - | 15.15owners, the care required of a director by section 302A.251, 308B.455, 308C.455, or |
|---|
| 495 | | - | 15.16317A.251, as applicable. The officers and directors appointed by the declarant shall have |
|---|
| 496 | | - | 15.17a duty to fulfill, and to cause the association to fulfill, their respective obligations under the |
|---|
| 497 | | - | 15.18declaration, bylaws, articles of incorporation, and this chapter and to enforce the provisions |
|---|
| 498 | | - | 15.19of the declaration, bylaws, articles of incorporation, and this chapter against all unit owners, |
|---|
| 499 | | - | 15.20including the declarant and its affiliates, in a uniform and fair manner. The standards of |
|---|
| 500 | | - | 15.21conduct for officers and directors set forth in this subsection shall also apply to the officers |
|---|
| 501 | | - | 15.22and directors of master associations in the exercise of their duties on behalf of the master |
|---|
| 502 | | - | 15.23association. |
|---|
| 503 | | - | 15.24 (b) The board may not act unilaterally to amend the declaration, to terminate the common |
|---|
| 504 | | - | 15.25interest community, to elect directors to the board, or to determine the qualifications, powers |
|---|
| 505 | | - | 15.26and duties, or terms of office of directors, but the board may fill vacancies in its membership |
|---|
| 506 | | - | 15.27created other than by removal by the vote of the association members for the unexpired |
|---|
| 507 | | - | 15.28portion of any term. |
|---|
| 508 | | - | 15.29 (c) The declaration may provide for a period of declarant control of the association, |
|---|
| 509 | | - | 15.30during which a declarant, or persons designated by the declarant, may appoint and remove |
|---|
| 510 | | - | 15.31the officers and directors of the association. The period of declarant control begins on the |
|---|
| 511 | | - | 15.32date of creation of the common interest community and terminates upon the earliest of the |
|---|
| 512 | | - | 15.33following events: (i) five years after the date of the first conveyance of a unit to a unit owner |
|---|
| 513 | | - | 15Article 1 Sec. 5. |
|---|
| 514 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 16.1other than a declarant in the case of a flexible common interest community or three years |
|---|
| 515 | | - | 16.2in the case of any other common interest community, (ii) the declarant's voluntary surrender |
|---|
| 516 | | - | 16.3of control by giving written notice to the unit owners pursuant to section 515B.1-115, or |
|---|
| 517 | | - | 16.4(iii) the conveyance of 75 percent of the units to unit owners other than a declarant. |
|---|
| 518 | | - | 16.5 (d) The board shall cause a meeting of the unit owners to be called, as follows: |
|---|
| 519 | | - | 16.6 (1) If the period of declarant control has terminated pursuant to subsection (c), a meeting |
|---|
| 520 | | - | 16.7of the unit owners shall be called and held within 60 days after said termination, at which |
|---|
| 521 | | - | 16.8the board shall be appointed or elected by all unit owners, including declarant, subject to |
|---|
| 522 | | - | 16.9the requirements of subsection (e). |
|---|
| 523 | | - | 16.10 (2) If 50 percent of the units that a declarant is authorized by the declaration to create |
|---|
| 524 | | - | 16.11have been conveyed prior to the termination of the declarant control period, a meeting of |
|---|
| 525 | | - | 16.12the unit owners shall be called and held within 60 days thereafter, at which not less than |
|---|
| 526 | | - | 16.1333-1/3 percent of the members of the board shall be elected by unit owners other than a |
|---|
| 527 | | - | 16.14declarant or an affiliate of a declarant. |
|---|
| 528 | | - | 16.15 (3) If the board fails or refuses to cause a meeting of the unit owners required to be called |
|---|
| 529 | | - | 16.16pursuant to subsection (d), then the unit owners other than a declarant and its affiliates may |
|---|
| 530 | | - | 16.17cause the meeting to be called pursuant to the applicable provisions of the law under which |
|---|
| 531 | | - | 16.18the association was created. The declarant and its affiliates shall be deemed to be present |
|---|
| 532 | | - | 16.19at the meeting for purposes of establishing a quorum regardless of their failure to attend the |
|---|
| 533 | | - | 16.20meeting. |
|---|
| 534 | | - | 16.21 (e) Following the termination of any period of declarant control, the unit owners shall |
|---|
| 535 | | - | 16.22appoint or elect the board. All unit owners, including the declarant and its affiliates, may |
|---|
| 536 | | - | 16.23cast the votes allocated to any units owned by them. The board shall thereafter be subject |
|---|
| 537 | | - | 16.24to the following: |
|---|
| 538 | | - | 16.25 (1) Unless otherwise approved by a vote of unit owners other than the declarant or an |
|---|
| 539 | | - | 16.26affiliate of the declarant, a majority of the directors shall be unit owners or a natural person |
|---|
| 540 | | - | 16.27designated by a unit owner that is not a natural person, other than a declarant or an affiliate |
|---|
| 541 | | - | 16.28of a declarant. The remaining directors need not be unit owners unless required by the |
|---|
| 542 | | - | 16.29articles of incorporation or bylaws. |
|---|
| 543 | | - | 16.30 (2) Subject to the requirements of subsection (e)(1), the articles of incorporation or |
|---|
| 544 | | - | 16.31bylaws may authorize the declarant or a person designated by the declarant to appoint one |
|---|
| 545 | | - | 16.32director, who need not be a member. The articles of incorporation or bylaws shall not be |
|---|
| 546 | | - | 16.33amended to change or terminate the authorization to appoint one director without the written |
|---|
| 547 | | - | 16.34consent of the declarant or other person possessing the power to appoint. |
|---|
| 548 | | - | 16Article 1 Sec. 5. |
|---|
| 549 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 17.1 (3) Subject to the requirements of subsection (e)(1), the articles of incorporation or |
|---|
| 550 | | - | 17.2bylaws may authorize special classes of directors and director voting rights, as follows: (i) |
|---|
| 551 | | - | 17.3classes of directors, (ii) the appointment or election of directors in certain classes by certain |
|---|
| 552 | | - | 17.4classes of members, or (iii) class voting by classes of directors on issues affecting only a |
|---|
| 553 | | - | 17.5certain class or classes of members, units, or other parcels of real estate, or to otherwise |
|---|
| 554 | | - | 17.6protect the legitimate interest of such class or classes. No person may utilize such special |
|---|
| 555 | | - | 17.7classes or class voting for the purpose of evading any limitation imposed on declarants by |
|---|
| 556 | | - | 17.8this chapter. |
|---|
| 557 | | - | 17.9 (4) The board shall elect the officers. The directors and officers shall take office upon |
|---|
| 558 | | - | 17.10election. |
|---|
| 559 | | - | 17.11 (f) In determining whether the period of declarant control has terminated under subsection |
|---|
| 560 | | - | 17.12(c), or whether unit owners other than a declarant are entitled to elect members of the board |
|---|
| 561 | | - | 17.13of directors under subsection (d), the percentage of the units conveyed shall be calculated |
|---|
| 562 | | - | 17.14using as a numerator the number of units conveyed and as a denominator the number of |
|---|
| 563 | | - | 17.15units subject to the declaration plus the number of units which the declarant is authorized |
|---|
| 564 | | - | 17.16by the declaration to create on any additional real estate. The percentages referred to in |
|---|
| 565 | | - | 17.17subsections (c) and (d) shall be calculated without reference to units that are auxiliary to |
|---|
| 566 | | - | 17.18other units, such as garage units or storage units. A person shall not use a master association |
|---|
| 567 | | - | 17.19or other device to evade the requirements of this section. |
|---|
| 568 | | - | 17.20 (g) Except as otherwise provided in this subsection, all meetings of the board of directors |
|---|
| 569 | | - | 17.21must be open to the unit owners. To the extent practicable, The board shall give reasonable |
|---|
| 570 | | - | 17.22notice to the unit owners of the date, time, and place, and agenda of a board meeting. If the |
|---|
| 571 | | - | 17.23date, time, and place of meetings are provided for in the declaration, articles, or bylaws, |
|---|
| 572 | | - | 17.24announced at a previous meeting of the board, posted in a location accessible to the unit |
|---|
| 573 | | - | 17.25owners and designated by the board from time to time, or if an emergency requires immediate |
|---|
| 574 | | - | 17.26consideration of a matter by the board, notice is not required. "Notice" has the meaning |
|---|
| 575 | | - | 17.27given in section 317A.011, subdivision 14. Prior to the board taking action on an agenda |
|---|
| 576 | | - | 17.28item, any unit owner or any person designated in writing by a member as the member's |
|---|
| 577 | | - | 17.29representative must be permitted to attend and speak during any meeting on any subject |
|---|
| 578 | | - | 17.30that is on the meeting agenda. A time must be designated by the board at each meeting for |
|---|
| 579 | | - | 17.31any unit owner, or the unit owner's designee, to raise any issue that is not on the meeting |
|---|
| 580 | | - | 17.32agenda and that is related to the association or the common interest community. The board |
|---|
| 581 | | - | 17.33may place a reasonable limit on the time a member is allowed to speak. Meetings may occur |
|---|
| 582 | | - | 17.34virtually but an association must provide access to all members to assert their right under |
|---|
| 583 | | - | 17Article 1 Sec. 5. |
|---|
| 584 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 18.1this section, including technical assistance to participate in virtual meetings and electronic |
|---|
| 585 | | - | 18.2voting. Meetings may be closed to discuss the following: |
|---|
| 586 | | - | 18.3 (1) personnel matters; |
|---|
| 587 | | - | 18.4 (2) pending or potential litigation, arbitration or other potentially adversarial proceedings, |
|---|
| 588 | | - | 18.5between unit owners, between the board or association and unit owners, or other matters in |
|---|
| 589 | | - | 18.6which any unit owner may have an adversarial interest, if the board determines that closing |
|---|
| 590 | | - | 18.7the meeting is necessary to discuss strategy or to otherwise protect the position of the board |
|---|
| 591 | | - | 18.8or association or the privacy of a unit owner or occupant of a unit; or |
|---|
| 592 | | - | 18.9 (3) criminal activity arising within the common interest community if the board |
|---|
| 593 | | - | 18.10determines that closing the meeting is necessary to protect the privacy of the victim or that |
|---|
| 594 | | - | 18.11opening the meeting would jeopardize investigation of the activity. |
|---|
| 595 | | - | 18.12 Nothing in this subsection imposes a duty on the board to provide special facilities for |
|---|
| 596 | | - | 18.13meetings. The failure to give notice as required by this subsection shall not invalidate the |
|---|
| 597 | | - | 18.14board meeting or any action taken at the meeting. The minutes of any part of a meeting that |
|---|
| 598 | | - | 18.15is closed under this subsection may be kept confidential at the discretion of the board. |
|---|
| 599 | | - | 18.16 (h) The conflict of interest standards set forth in section 317A.255 are required of officers |
|---|
| 600 | | - | 18.17and directors and apply to an actual or potential conflict of interest that arises concerning |
|---|
| 601 | | - | 18.18an officer or director, regardless of whether appointed or elected, and in addition to those |
|---|
| 602 | | - | 18.19requirements: |
|---|
| 603 | | - | 18.20 (1) no board member or the spouse, sibling, child, or parent of any board member may |
|---|
| 604 | | - | 18.21have a financial interest in a business that the association or a property management company |
|---|
| 605 | | - | 18.22has hired or contracted with for goods or services over $2,000 in any calendar year; |
|---|
| 606 | | - | 18.23 (2) no board member or the spouse, sibling, child, or parent of any board member may |
|---|
| 607 | | - | 18.24solicit or accept any form of direct or indirect compensation, gift, money, rebate, gratuity, |
|---|
| 608 | | - | 18.25remuneration of any kind, or anything of value from any person or entity performing services |
|---|
| 609 | | - | 18.26for the association or a board member or any person or entity with which the association or |
|---|
| 610 | | - | 18.27a board member has a contract or other business relationship; |
|---|
| 611 | | - | 18.28 (3) no association or board of directors of an association shall solicit or accept any gift, |
|---|
| 612 | | - | 18.29money, rebate, any form of direct or indirect compensation, gratuity, remuneration of any |
|---|
| 613 | | - | 18.30kind, or anything of value that would improperly influence or would appear to a reasonable |
|---|
| 614 | | - | 18.31person to improperly influence the decisions made by the association; |
|---|
| 615 | | - | 18.32 (4) no management company or the employee, owner, or individual with a financial |
|---|
| 616 | | - | 18.33interest in a management company that is providing services to an entity covered by this |
|---|
| 617 | | - | 18Article 1 Sec. 5. |
|---|
| 618 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 19.1chapter may have a financial interest in a business the association or management company |
|---|
| 619 | | - | 19.2has hired or contracted with for goods or services in excess of $2,000 in any calendar year |
|---|
| 620 | | - | 19.3and may not solicit or accept any gift, money, rebate, gratuity, or direct or indirect |
|---|
| 621 | | - | 19.4compensation from any person or entity performing services for the association or for the |
|---|
| 622 | | - | 19.5award of a contract for goods or services; or |
|---|
| 623 | | - | 19.6 (5) no association or board of directors of an association shall enter into a contract or |
|---|
| 624 | | - | 19.7any other business relationship on behalf of an association or a board member from which |
|---|
| 625 | | - | 19.8the management company, its owner or owners, any of its managerial officials, or any of |
|---|
| 626 | | - | 19.9its employees or any spouse, domestic partner, or relative of the owner or owners, managerial |
|---|
| 627 | | - | 19.10officials, or any employee of the management company has received or could receive a |
|---|
| 628 | | - | 19.11direct or indirect financial benefit in excess of $2,000 in any calendar year. |
|---|
| 629 | | - | 19.12 (i) An annual report must be prepared and signed by each member of the board of |
|---|
| 630 | | - | 19.13directors for the association listing all contracts for goods or services for the previous budget |
|---|
| 631 | | - | 19.14year, including the purpose of the contract, the amount of the contract, the identity of the |
|---|
| 632 | | - | 19.15recipient of the contract award, the date of the meeting the contract was approved, the |
|---|
| 633 | | - | 19.16directors present at the meeting, the date the contract became valid, and any fees or payments |
|---|
| 634 | | - | 19.17made related to the contract to a third party or management company. The annual report |
|---|
| 635 | | - | 19.18must be sent to each member owner annually. |
|---|
| 636 | | - | 19.19 (j) A property management company that is hired by a board of directors or association |
|---|
| 637 | | - | 19.20covered under this section may not enter into a contract that automatically renews for goods |
|---|
| 638 | | - | 19.21or services for the association, unless the contract provides that the association or |
|---|
| 639 | | - | 19.22management company can terminate the contract at any time with no more than 60 days' |
|---|
| 640 | | - | 19.23notice. |
|---|
| 641 | | - | 19.24 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 642 | | - | 19.25Sec. 6. Minnesota Statutes 2024, section 515B.3-106, is amended to read: |
|---|
| 643 | | - | 19.26 515B.3-106 BYLAWS; ANNUAL REPORT. |
|---|
| 644 | | - | 19.27 (a) A common interest community shall have bylaws which comply with this chapter |
|---|
| 645 | | - | 19.28and the statute under which the association is incorporated. The bylaws and any amendments |
|---|
| 646 | | - | 19.29may be recorded, but need not be recorded to be effective unless so provided in the bylaws. |
|---|
| 647 | | - | 19.30Any amendment, addition, or repeal of the bylaws must be approved at the annual meeting, |
|---|
| 648 | | - | 19.31and an association must give homeowners the opportunity to comment on the proposed |
|---|
| 649 | | - | 19.32change at the meeting at which the change is considered. Any bylaw in effect may be revoked |
|---|
| 650 | | - | 19.33by a majority vote of the unit owners at the annual meeting, where unit owners may vote |
|---|
| 651 | | - | 19Article 1 Sec. 6. |
|---|
| 652 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 20.1in person, by a written statement signed and dated by the unit owner prior to the meeting |
|---|
| 653 | | - | 20.2at which revocation is considered, or by proxy. |
|---|
| 654 | | - | 20.3 (b) The bylaws shall provide that, in addition to any statutory requirements: |
|---|
| 655 | | - | 20.4 (1) A meeting of the members shall be held at least once each year, and a specified |
|---|
| 656 | | - | 20.5officer of the association shall give notice of the meeting as provided in section 515B.3-108. |
|---|
| 657 | | - | 20.6 (2) An annual report shall be prepared by the association and a copy of the report shall |
|---|
| 658 | | - | 20.7be provided to each unit owner at or prior to the annual meeting. |
|---|
| 659 | | - | 20.8 (c) The annual report shall contain at a minimum: |
|---|
| 660 | | - | 20.9 (1) a statement of any capital expenditures in excess of two percent of the current budget |
|---|
| 661 | | - | 20.10or $5,000, whichever is greater, approved by the association for the current fiscal year or |
|---|
| 662 | | - | 20.11succeeding two fiscal years; |
|---|
| 663 | | - | 20.12 (2) a statement of the association's total replacement reserves, the components of the |
|---|
| 664 | | - | 20.13common interest community for which the reserves are set aside, and the amounts of the |
|---|
| 665 | | - | 20.14reserves, if any, that the board has allocated for the replacement of each of those components; |
|---|
| 666 | | - | 20.15 (3) a copy of the statement of revenues and expenses for the association's last fiscal year, |
|---|
| 667 | | - | 20.16and a balance sheet as of the end of said fiscal year; |
|---|
| 668 | | - | 20.17 (4) a statement of the status of any pending litigation or judgments to which the |
|---|
| 669 | | - | 20.18association is a party; |
|---|
| 670 | | - | 20.19 (5) a detailed description of the insurance coverage provided by the association including |
|---|
| 671 | | - | 20.20a statement as to which, if any, of the items referred to in section 515B.3-113, subsection |
|---|
| 672 | | - | 20.21(b), are insured by the association; and |
|---|
| 673 | | - | 20.22 (6) a statement of the total past due assessments on all units, current as of not more than |
|---|
| 674 | | - | 20.2360 days prior to the date of the meeting. |
|---|
| 675 | | - | 20.24 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 676 | | - | 20.25Sec. 7. Minnesota Statutes 2024, section 515B.3-107, is amended to read: |
|---|
| 677 | | - | 20.26 515B.3-107 UPKEEP OF COMMON INTEREST COMMUNITY . |
|---|
| 678 | | - | 20.27 (a) Except to the extent provided by the declaration, this subsection or section |
|---|
| 679 | | - | 20.28515B.3-113, the association is responsible for the maintenance, repair and replacement of |
|---|
| 680 | | - | 20.29the common elements, and each unit owner is responsible for the maintenance, repair and |
|---|
| 681 | | - | 20.30replacement of the unit owner's unit. A management company may not require an association |
|---|
| 682 | | - | 20.31to work with a particular vendor. Damage to the common elements or any unit as a result |
|---|
| 683 | | - | 20Article 1 Sec. 7. |
|---|
| 684 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 21.1of the acts or omissions of a unit owner or the association, including damage resulting from |
|---|
| 685 | | - | 21.2the unit owner's or association's lack of maintenance or failure to perform necessary repairs |
|---|
| 686 | | - | 21.3or replacement, is the responsibility of the unit owner or association responsible for causing |
|---|
| 687 | | - | 21.4the damage, or whose agents or, subject to section 515B.3-115, subsection (g), and section |
|---|
| 688 | | - | 21.5515B.3-1151, subsection (g), invitees caused the damage. |
|---|
| 689 | | - | 21.6 (b) The association's board of directors shall prepare and approve a written preventative |
|---|
| 690 | | - | 21.7maintenance plan, maintenance schedule, and maintenance budget for the common elements. |
|---|
| 691 | | - | 21.8The association shall follow the approved preventative maintenance plan. The association's |
|---|
| 692 | | - | 21.9board may amend, modify, or replace an approved preventative maintenance plan or an |
|---|
| 693 | | - | 21.10approved maintenance schedule from time to time. The association must provide all unit |
|---|
| 694 | | - | 21.11owners with a paper copy, electronic copy, or electronic access to the preventative |
|---|
| 695 | | - | 21.12maintenance plan, the maintenance schedule, and any amendments or modifications to or |
|---|
| 696 | | - | 21.13replacements of the preventative maintenance plan and the maintenance schedule. If a |
|---|
| 697 | | - | 21.14common interest community was created on or before August 1, 2017, the association's |
|---|
| 698 | | - | 21.15board of directors shall have until January 1, 2019, to comply with the requirements of this |
|---|
| 699 | | - | 21.16subsection. |
|---|
| 700 | | - | 21.17 (c) The association shall have access through and into each unit for purposes of |
|---|
| 701 | | - | 21.18performing maintenance, repair or replacement for which the association may be responsible. |
|---|
| 702 | | - | 21.19The association and any public safety personnel shall also have access for purposes of |
|---|
| 703 | | - | 21.20abating or correcting any condition in the unit which violates any governmental law, |
|---|
| 704 | | - | 21.21ordinance or regulation, which may cause material damage to or jeopardize the safety of |
|---|
| 705 | | - | 21.22the common interest community, or which may constitute a health or safety hazard for |
|---|
| 706 | | - | 21.23occupants of units. |
|---|
| 707 | | - | 21.24 (d) Neither the association, nor any unit owner other than the declarant or its affiliates, |
|---|
| 708 | | - | 21.25is subject to a claim for payment of expenses incurred in connection with any additional |
|---|
| 709 | | - | 21.26real estate. |
|---|
| 710 | | - | 21.27 (e) In exercising any authority granted to it under the declaration to approve or disapprove |
|---|
| 711 | | - | 21.28proposed changes to a unit or limited common element, the association's board shall provide |
|---|
| 712 | | - | 21.29a fair, reasonable, and expeditious procedure for making any decision. The procedure shall |
|---|
| 713 | | - | 21.30be set forth in the association's governing documents. The procedures shall state the |
|---|
| 714 | | - | 21.31maximum time for issuance of any decision on a proposal or a request for consideration. |
|---|
| 715 | | - | 21.32At a minimum, the association's board must make a decision within 90 days after the initial |
|---|
| 716 | | - | 21.33submission of the proposal or submission of any additional information or changes to the |
|---|
| 717 | | - | 21.34proposal requested by the association's board in response to the initial submission. A decision |
|---|
| 718 | | - | 21.35must be in writing, must be made in good faith, and must not be unreasonable, arbitrary, or |
|---|
| 719 | | - | 21Article 1 Sec. 7. |
|---|
| 720 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 22.1capricious. If the proposal is disapproved, the decision must include both an explanation of |
|---|
| 721 | | - | 22.2why the proposal is disapproved and a description of the procedure for reconsideration of |
|---|
| 722 | | - | 22.3the decision by the association's board. |
|---|
| 723 | | - | 22.4 (f) Unless expressly provided for in the declaration, the association must not enforce |
|---|
| 724 | | - | 22.5any restriction on parking of a personal vehicle on a public street or public road for which |
|---|
| 725 | | - | 22.6the state or local government has assumed responsibility for maintenance and repairs, unless |
|---|
| 726 | | - | 22.7the authority to regulate such parking has been expressly delegated to the association by |
|---|
| 727 | | - | 22.8the state or local government under terms prescribing the manner in which the association |
|---|
| 728 | | - | 22.9may exercise that authority. Any such delegation is valid for a period not to exceed five |
|---|
| 729 | | - | 22.10years, at which time the association must reapply to the delegating entity. As used in this |
|---|
| 730 | | - | 22.11subsection, "personal vehicle" means an automobile with a gross weight of less than 26,001 |
|---|
| 731 | | - | 22.12pounds that is used for personal pleasure, travel, or commuting to and from a place of work, |
|---|
| 732 | | - | 22.13and does not include a motor home or self-propelled recreational vehicle, or an automobile |
|---|
| 733 | | - | 22.14that is otherwise used primarily in connection with any commercial endeavor or business. |
|---|
| 734 | | - | 22.15 (g) A unit owner or resident may park a work vehicle, including but not limited to a van, |
|---|
| 735 | | - | 22.16pickup truck, small truck, ambulance, law enforcement vehicle, utility company vehicle, or |
|---|
| 736 | | - | 22.17emergency response vehicle, on the unit owner's property or curtilage, provided the vehicle's |
|---|
| 737 | | - | 22.18length does not encroach on another unit owner's property or interfere with the association's |
|---|
| 738 | | - | 22.19ability to maintain roads or common elements. An association must not prohibit or restrict |
|---|
| 739 | | - | 22.20this parking. |
|---|
| 740 | | - | 22.21 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 741 | | - | 22.22Sec. 8. Minnesota Statutes 2024, section 515B.3-108, is amended to read: |
|---|
| 742 | | - | 22.23 515B.3-108 MEETINGS. |
|---|
| 743 | | - | 22.24 (a) A meeting of the association shall be held at least once each year. At each annual |
|---|
| 744 | | - | 22.25meeting, there shall be, at a minimum, (i) an election of successor directors for those directors |
|---|
| 745 | | - | 22.26whose terms have expired, (ii) a report on the activities and financial condition of the |
|---|
| 746 | | - | 22.27association, and (iii) consideration of and action on any other matters included in the notice |
|---|
| 747 | | - | 22.28of meeting. Unless the bylaws provide otherwise, special meetings of the association may |
|---|
| 748 | | - | 22.29be called by the president and shall be called by the president or secretary upon the written |
|---|
| 749 | | - | 22.30petition of a majority of the board or unit owners entitled to cast at least 20 percent of the |
|---|
| 750 | | - | 22.31votes in the association. |
|---|
| 751 | | - | 22.32 (b) Not less than 21 nor more than 30 days in advance of any annual meeting, and not |
|---|
| 752 | | - | 22.33less than seven nor more than 30 days in advance of any special meeting, the secretary or |
|---|
| 753 | | - | 22Article 1 Sec. 8. |
|---|
| 754 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 23.1other officer specified in the bylaws shall cause notice to be hand delivered or sent postage |
|---|
| 755 | | - | 23.2prepaid by United States mail to the mailing address of each unit, or to any other address |
|---|
| 756 | | - | 23.3designated in writing by the unit owner to the association as provided in the bylaws or by |
|---|
| 757 | | - | 23.4statute. |
|---|
| 758 | | - | 23.5 (c) The notice of any meeting shall state the date, time and place of the meeting, the |
|---|
| 759 | | - | 23.6purposes of the meeting, and, if proxies are permitted, the procedures for appointing proxies. |
|---|
| 760 | | - | 23.7The notice must include copies of any documents that are subject to discussion or approval |
|---|
| 761 | | - | 23.8at the meeting, including the budget. |
|---|
| 762 | | - | 23.9 (d) The board may provide for reasonable procedures governing the conduct of meetings |
|---|
| 763 | | - | 23.10and elections. |
|---|
| 764 | | - | 23.11 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 765 | | - | 23.12Sec. 9. Minnesota Statutes 2024, section 515B.3-110, is amended to read: |
|---|
| 766 | | - | 23.13 515B.3-110 VOTING; PROXIES. |
|---|
| 767 | | - | 23.14 (a) At any meeting of the association an owner or the holder of the owner's proxy shall |
|---|
| 768 | | - | 23.15be entitled to cast the vote which is allocated to the unit. If there is more than one owner of |
|---|
| 769 | | - | 23.16a unit, only one of the owners may cast the vote. If the owners of a unit fail to agree and |
|---|
| 770 | | - | 23.17notify the association as to who shall cast the vote, the vote shall not be cast. Any provision |
|---|
| 771 | | - | 23.18in the articles of incorporation, bylaws, declaration, or other document restricting a unit |
|---|
| 772 | | - | 23.19owner's right to vote, or affecting quorum requirements, by reason of nonpayment of |
|---|
| 773 | | - | 23.20assessments, or a purported violation of any provision of the documents governing the |
|---|
| 774 | | - | 23.21common interest community, shall be void. |
|---|
| 775 | | - | 23.22 (b) If permitted by the articles or bylaws, votes allocated to a unit may be cast pursuant |
|---|
| 776 | | - | 23.23to a proxy executed by the unit owner entitled to cast the vote for that unit. The board may |
|---|
| 777 | | - | 23.24specify the form of proxy and proxy rules, consistent with law. A current board member |
|---|
| 778 | | - | 23.25cannot act as a proxy for a unit owner. No more than 20 percent of votes cast on any single |
|---|
| 779 | | - | 23.26vote can be by proxy. |
|---|
| 780 | | - | 23.27 (c) Except as provided in section 515B.3-106, if authorized by the statute under which |
|---|
| 781 | | - | 23.28the association is created, and to the extent not limited or prohibited by the articles of |
|---|
| 782 | | - | 23.29incorporation, bylaws, or declaration, the vote on any issue or issues may be taken by |
|---|
| 783 | | - | 23.30electronic means or by mailed ballots, in compliance with the applicable statute, in lieu of |
|---|
| 784 | | - | 23.31holding a meeting of the unit owners. Such a vote shall have the force and effect of a vote |
|---|
| 785 | | - | 23.32taken at a meeting; provided, that the total votes cast are at least equal to the votes required |
|---|
| 786 | | - | 23.33for a quorum. The board shall set a voting period within which the ballots or other voting |
|---|
| 787 | | - | 23Article 1 Sec. 9. |
|---|
| 788 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 24.1response must be received by the association, which period shall be not less than 15 nor |
|---|
| 789 | | - | 24.2more than 45 days after the date of delivery of the notice of the vote and voting procedures |
|---|
| 790 | | - | 24.3to the unit owners. The board of directors shall provide notice of the results of the vote to |
|---|
| 791 | | - | 24.4the unit owners within 30 days after the expiration of the voting period. All requirements |
|---|
| 792 | | - | 24.5in this chapter, the declaration or the bylaws for a meeting of the unit owners, or being |
|---|
| 793 | | - | 24.6present in person, shall be deemed satisfied by a vote taken in compliance with the |
|---|
| 794 | | - | 24.7requirements of this section. The voting procedures authorized by this section shall not be |
|---|
| 795 | | - | 24.8used in combination with a vote taken at a meeting of the unit owners. However, voting by |
|---|
| 796 | | - | 24.9electronic means and mailed ballot may be combined if each is done in compliance with |
|---|
| 797 | | - | 24.10the applicable statute. |
|---|
| 798 | | - | 24.11 (d) The articles of incorporation or bylaws may authorize class voting by unit owners |
|---|
| 799 | | - | 24.12for directors or on specified issues affecting the class. Class voting may only be used to |
|---|
| 800 | | - | 24.13address operational, physical, or administrative differences within the common interest |
|---|
| 801 | | - | 24.14community. A declarant shall not use class voting to evade any limit imposed on declarants |
|---|
| 802 | | - | 24.15by this chapter and units shall not constitute a class because they are owned by a declarant. |
|---|
| 803 | | - | 24.16 (e) The declaration or bylaws may provide that votes on specified matters affecting the |
|---|
| 804 | | - | 24.17common interest community be cast by lessees or secured parties rather than unit owners; |
|---|
| 805 | | - | 24.18provided that (i) the provisions of subsections (a), (b), and (c) apply to those persons as if |
|---|
| 806 | | - | 24.19they were unit owners; (ii) unit owners who have so delegated their votes to other persons |
|---|
| 807 | | - | 24.20may not cast votes on those specified matters; (iii) lessees or secured parties are entitled to |
|---|
| 808 | | - | 24.21notice of meetings, access to records, and other rights respecting those matters as if they |
|---|
| 809 | | - | 24.22were unit owners, and (iv) the lessee or secured party has filed satisfactory evidence of its |
|---|
| 810 | | - | 24.23interest with the secretary of the association prior to the meeting. Unit owners must also be |
|---|
| 811 | | - | 24.24given notice, in the manner provided in section 515B.3-108(b), of meetings at which lessees |
|---|
| 812 | | - | 24.25or secured parties are entitled to vote. |
|---|
| 813 | | - | 24.26 (f) No votes allocated to a unit owned by the association may be cast nor counted toward |
|---|
| 814 | | - | 24.27a quorum. |
|---|
| 815 | | - | 24.28 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 816 | | - | 24.29Sec. 10. Minnesota Statutes 2024, section 515B.3-115, is amended to read: |
|---|
| 817 | | - | 24.30 515B.3-115 ASSESSMENTS FOR COMMON EXPENSES; CIC CREATED |
|---|
| 818 | | - | 24.31BEFORE AUGUST 1, 2010. |
|---|
| 819 | | - | 24.32 (a) The obligation of a unit owner to pay common expense assessments shall be as |
|---|
| 820 | | - | 24.33follows: |
|---|
| 821 | | - | 24Article 1 Sec. 10. |
|---|
| 822 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 25.1 (1) If a common expense assessment has not been levied, the declarant shall pay all |
|---|
| 823 | | - | 25.2operating expenses of the common interest community, and shall fund the replacement |
|---|
| 824 | | - | 25.3reserve component of the common expenses as required by subsection (b). |
|---|
| 825 | | - | 25.4 (2) If a common expense assessment has been levied, all unit owners, including the |
|---|
| 826 | | - | 25.5declarant, shall pay the assessments allocated to their units, subject to the following: |
|---|
| 827 | | - | 25.6 (i) If the declaration so provides, a declarant's liability, and the assessment lien, for the |
|---|
| 828 | | - | 25.7common expense assessments, exclusive of replacement reserves, on any unit owned by |
|---|
| 829 | | - | 25.8the declarant may be limited to 25 percent or more of any assessment, exclusive of |
|---|
| 830 | | - | 25.9replacement reserves, until the unit or any building located in the unit is substantially |
|---|
| 831 | | - | 25.10completed. Substantial completion shall be evidenced by a certificate of occupancy in any |
|---|
| 832 | | - | 25.11jurisdiction that issues the certificate. |
|---|
| 833 | | - | 25.12 (ii) If the declaration provides for a reduced assessment pursuant to paragraph (2)(i), |
|---|
| 834 | | - | 25.13the declarant shall be obligated, within 60 days following the termination of the period of |
|---|
| 835 | | - | 25.14declarant control, to make up any operating deficit incurred by the association during the |
|---|
| 836 | | - | 25.15period of declarant control. The existence and amount, if any, of the operating deficit shall |
|---|
| 837 | | - | 25.16be determined using the accrual basis of accounting applied as of the date of termination |
|---|
| 838 | | - | 25.17of the period of declarant control, regardless of the accounting methodology previously |
|---|
| 839 | | - | 25.18used by the association to maintain its accounts. |
|---|
| 840 | | - | 25.19 (b) The replacement reserve component of the common expenses shall be funded for |
|---|
| 841 | | - | 25.20each unit in accordance with the projected annual budget required by section |
|---|
| 842 | | - | 25.21515B.4-102(a)(23) provided that the funding of replacement reserves with respect to a unit |
|---|
| 843 | | - | 25.22shall commence no later than the date that the unit or any building located within the unit |
|---|
| 844 | | - | 25.23boundaries is substantially completed. Substantial completion shall be evidenced by a |
|---|
| 845 | | - | 25.24certificate of occupancy in any jurisdiction that issues the certificate. |
|---|
| 846 | | - | 25.25 (c) After an assessment has been levied by the association, assessments shall be levied |
|---|
| 847 | | - | 25.26at least annually, based upon a budget approved at least annually by the association. The |
|---|
| 848 | | - | 25.27association shall provide each member of the homeowners association with a copy of the |
|---|
| 849 | | - | 25.28proposed annual budget prior to the annual meeting at which the budget is to be approved |
|---|
| 850 | | - | 25.29and allow member input on the budget prior to or during the meeting. |
|---|
| 851 | | - | 25.30 (d) Except as modified by subsections (a)(1) and (2), (e), (f), and (g), all common |
|---|
| 852 | | - | 25.31expenses shall be assessed against all the units in accordance with the allocations established |
|---|
| 853 | | - | 25.32by the declaration pursuant to section 515B.2-108. |
|---|
| 854 | | - | 25.33 (e) Unless otherwise required by the declaration: |
|---|
| 855 | | - | 25Article 1 Sec. 10. |
|---|
| 856 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 26.1 (1) any common expense associated with the maintenance, repair, or replacement of a |
|---|
| 857 | | - | 26.2limited common element shall be assessed against the units to which that limited common |
|---|
| 858 | | - | 26.3element is assigned, equally, or in any other proportion the declaration provides; |
|---|
| 859 | | - | 26.4 (2) any common expense or portion thereof benefiting fewer than all of the units may |
|---|
| 860 | | - | 26.5be assessed exclusively against the units benefited, equally, or in any other proportion the |
|---|
| 861 | | - | 26.6declaration provides; |
|---|
| 862 | | - | 26.7 (3) the costs of insurance may be assessed in proportion to risk or coverage, and the |
|---|
| 863 | | - | 26.8costs of utilities may be assessed in proportion to usage; |
|---|
| 864 | | - | 26.9 (4) subject to subsection (k) and section 515B.3-102(a)(11), reasonable attorney fees |
|---|
| 865 | | - | 26.10and costs incurred by the association in connection with (i) the collection of assessments |
|---|
| 866 | | - | 26.11against a unit owner, and (ii) the enforcement of this chapter, the articles, bylaws, declaration, |
|---|
| 867 | | - | 26.12or rules and regulations against a unit owner, may be assessed against the unit owner's unit |
|---|
| 868 | | - | 26.13subject to section 515B.3-116(h), provided that the attorney fees and costs for enforcement |
|---|
| 869 | | - | 26.14and collection may not exceed $1,500 and no fees or costs may be assessed if the association |
|---|
| 870 | | - | 26.15uses a collection agency as defined in section 332.31 if the fees of the collection agency are |
|---|
| 871 | | - | 26.16contingent on the amount collected; and |
|---|
| 872 | | - | 26.17 (5) subject to subsection (k), fees, charges, late charges, and fines and interest may be |
|---|
| 873 | | - | 26.18assessed as provided in section 515B.3-116(a). |
|---|
| 874 | | - | 26.19 (f) Assessments levied under section 515B.3-116 to pay a judgment against the association |
|---|
| 875 | | - | 26.20may be levied only against the units in the common interest community at the time the |
|---|
| 876 | | - | 26.21judgment was entered, in proportion to their common expense liabilities. |
|---|
| 877 | | - | 26.22 (g) If any damage to the common elements or another unit is caused by the act or omission |
|---|
| 878 | | - | 26.23of any unit owner, or occupant of a unit, or their invitees, the association may assess the |
|---|
| 879 | | - | 26.24costs of repairing the damage exclusively against the unit owner's unit to the extent not |
|---|
| 880 | | - | 26.25covered by insurance. |
|---|
| 881 | | - | 26.26 (h) Subject to any shorter period specified by the declaration or bylaws, if any installment |
|---|
| 882 | | - | 26.27of an assessment becomes more than 60 days past due, then the association may, upon ten |
|---|
| 883 | | - | 26.28days' written notice to the unit owner, declare the entire amount of the assessment |
|---|
| 884 | | - | 26.29immediately due and payable in full, except that any portion of the assessment that represents |
|---|
| 885 | | - | 26.30installments that are not due and payable without acceleration as of the date of reinstatement |
|---|
| 886 | | - | 26.31must not be included in the amount that a unit owner must pay to reinstate under section |
|---|
| 887 | | - | 26.32580.30 or chapter 581. |
|---|
| 888 | | - | 26Article 1 Sec. 10. |
|---|
| 889 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 27.1 (i) If common expense liabilities are reallocated for any purpose authorized by this |
|---|
| 890 | | - | 27.2chapter, common expense assessments and any installment thereof not yet due shall be |
|---|
| 891 | | - | 27.3recalculated in accordance with the reallocated common expense liabilities. |
|---|
| 892 | | - | 27.4 (j) An assessment against fewer than all of the units must be levied within three years |
|---|
| 893 | | - | 27.5after the event or circumstances forming the basis for the assessment, or shall be barred. |
|---|
| 894 | | - | 27.6 (k) An association must offer a unit owner a reasonable payment agreement and take |
|---|
| 895 | | - | 27.7into consideration the financial circumstances of the unit owner. |
|---|
| 896 | | - | 27.8 (k) (l) This section applies only to common interest communities created before August |
|---|
| 897 | | - | 27.91, 2010. |
|---|
| 898 | | - | 27.10 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 899 | | - | 27.11Sec. 11. Minnesota Statutes 2024, section 515B.3-1151, is amended to read: |
|---|
| 900 | | - | 27.12 515B.3-1151 ASSESSMENTS FOR COMMON EXPENSES; CIC CREATED ON |
|---|
| 901 | | - | 27.13OR AFTER AUGUST 1, 2010. |
|---|
| 902 | | - | 27.14 (a) The association shall approve an annual budget of common expenses at or prior to |
|---|
| 903 | | - | 27.15the conveyance of the first unit in the common interest community to a purchaser and |
|---|
| 904 | | - | 27.16annually thereafter. The association shall provide each member of the homeowners |
|---|
| 905 | | - | 27.17association with a copy of the proposed annual budget prior to the annual meeting at which |
|---|
| 906 | | - | 27.18the budget is to be approved and allow member input on the budget prior to or during the |
|---|
| 907 | | - | 27.19meeting. The annual budget shall include all customary and necessary operating expenses |
|---|
| 908 | | - | 27.20and replacement reserves for the common interest community, consistent with this section |
|---|
| 909 | | - | 27.21and section 515B.3-114. For purposes of replacement reserves under subsection (b), until |
|---|
| 910 | | - | 27.22an annual budget has been approved, the reserves shall be paid based upon the budget |
|---|
| 911 | | - | 27.23contained in the disclosure statement required by section 515B.4-102. The obligation of a |
|---|
| 912 | | - | 27.24unit owner to pay common expenses shall be as follows: |
|---|
| 913 | | - | 27.25 (1) If a common expense assessment has not been levied by the association, the declarant |
|---|
| 914 | | - | 27.26shall pay all common expenses of the common interest community, including the payment |
|---|
| 915 | | - | 27.27of the replacement reserve component of the common expenses for all units in compliance |
|---|
| 916 | | - | 27.28with subsection (b). |
|---|
| 917 | | - | 27.29 (2) If a common expense assessment has been levied by the association, all unit owners, |
|---|
| 918 | | - | 27.30including the declarant, shall pay the assessments levied against their units, except as follows: |
|---|
| 919 | | - | 27.31 (i) The declaration may provide for an alternate common expense plan whereby the |
|---|
| 920 | | - | 27.32declarant's common expense liability, and the corresponding assessment lien against the |
|---|
| 921 | | - | 27Article 1 Sec. 11. |
|---|
| 922 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 28.1units owned by the declarant, is limited to: (A) paying when due, in compliance with |
|---|
| 923 | | - | 28.2subsection (b), an amount equal to the full share of the replacement reserves allocated to |
|---|
| 924 | | - | 28.3units owned by the declarant, as set forth in the association's annual budget approved as |
|---|
| 925 | | - | 28.4provided in this subsection; and (B) paying when due all accrued expenses of the common |
|---|
| 926 | | - | 28.5interest community in excess of the aggregate assessments payable with respect to units |
|---|
| 927 | | - | 28.6owned by persons other than a declarant; provided, that the alternate common expense plan |
|---|
| 928 | | - | 28.7shall not affect a declarant's obligation to make up any operating deficit pursuant to item |
|---|
| 929 | | - | 28.8(iv), and shall terminate upon the termination of any period of declarant control unless |
|---|
| 930 | | - | 28.9terminated earlier pursuant to item (iii). |
|---|
| 931 | | - | 28.10 (ii) The alternate common expense plan may be authorized only by including in the |
|---|
| 932 | | - | 28.11declaration and the disclosure statement required by section 515B.4-102 provisions |
|---|
| 933 | | - | 28.12authorizing and disclosing the alternate common expense plan as described in item (i), and |
|---|
| 934 | | - | 28.13including in the disclosure statement either (A) a statement that the alternate common |
|---|
| 935 | | - | 28.14expense plan will have no effect on the level of services or amenities anticipated by the |
|---|
| 936 | | - | 28.15association's budget contained in the disclosure statement, or (B) a statement describing |
|---|
| 937 | | - | 28.16how the services or amenities may be affected. |
|---|
| 938 | | - | 28.17 (iii) A declarant shall give notice to the association of its intent to utilize the alternate |
|---|
| 939 | | - | 28.18common expense plan and a commencement date after the date the notice is given. The |
|---|
| 940 | | - | 28.19alternate common expense plan shall be valid only for periods after the notice is given. A |
|---|
| 941 | | - | 28.20declarant may terminate its right to utilize the alternate common expense plan prior to the |
|---|
| 942 | | - | 28.21termination of the period of declarant control only by giving notice to the association and |
|---|
| 943 | | - | 28.22the unit owners at least 30 days prior to a selected termination date set forth in the notice. |
|---|
| 944 | | - | 28.23 (iv) If a declarant utilizes an alternate common expense plan, that declarant shall cause |
|---|
| 945 | | - | 28.24to be prepared and delivered to the association, at the declarant's expense, within 90 days |
|---|
| 946 | | - | 28.25after the termination of the period of declarant control, an audited balance sheet and profit |
|---|
| 947 | | - | 28.26and loss statement certified to the association and prepared by an accountant having the |
|---|
| 948 | | - | 28.27qualifications set forth in section 515B.3-121(b). The audit shall be binding on the declarant |
|---|
| 949 | | - | 28.28and the association. |
|---|
| 950 | | - | 28.29 (v) If the audited profit and loss statement shows an accumulated operating deficit, the |
|---|
| 951 | | - | 28.30declarant shall be obligated to make up the deficit within 15 days after delivery of the audit |
|---|
| 952 | | - | 28.31to the association, and the association shall have a claim against the declarant for an amount |
|---|
| 953 | | - | 28.32equal to the deficit until paid. A declarant who does not utilize an alternate common expense |
|---|
| 954 | | - | 28.33plan is not liable to make up any operating deficit. If more than one declarant utilizes an |
|---|
| 955 | | - | 28.34alternate common expense plan, all declarants who utilize the plan are jointly and severally |
|---|
| 956 | | - | 28.35liable to the association for any operating deficit. |
|---|
| 957 | | - | 28Article 1 Sec. 11. |
|---|
| 958 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 29.1 (vi) The existence and amount, if any, of the operating deficit shall be determined using |
|---|
| 959 | | - | 29.2the accrual method of accounting applied as of the date of termination of the period of |
|---|
| 960 | | - | 29.3declarant control, regardless of the accounting methodology previously used by the |
|---|
| 961 | | - | 29.4association to maintain its accounts. |
|---|
| 962 | | - | 29.5 (vii) Unless approved by a vote of the unit owners other than the declarant and its |
|---|
| 963 | | - | 29.6affiliates, the operating deficit shall not be made up, prior to the election by the unit owners |
|---|
| 964 | | - | 29.7of a board of directors pursuant to section 515B.3-103(d), through the use of a special |
|---|
| 965 | | - | 29.8assessment described in subsection (c) or by assessments described in subsections (e), (f), |
|---|
| 966 | | - | 29.9and (g). |
|---|
| 967 | | - | 29.10 (viii) The use by a declarant of an alternate common expense plan shall not affect the |
|---|
| 968 | | - | 29.11obligations of the declarant or the association as provided in the declaration, the bylaws, or |
|---|
| 969 | | - | 29.12this chapter, or as represented in the disclosure statement required by section 515B.4-102, |
|---|
| 970 | | - | 29.13except as to matters authorized by this chapter. |
|---|
| 971 | | - | 29.14 (b) The replacement reserves required by section 515B.3-114 shall be paid to the |
|---|
| 972 | | - | 29.15association by each unit owner for each unit owned by that unit owner in accordance with |
|---|
| 973 | | - | 29.16the association's annual budget approved pursuant to subsection (a), regardless of whether |
|---|
| 974 | | - | 29.17an annual assessment has been levied or whether the declarant has utilized an alternate |
|---|
| 975 | | - | 29.18common expense plan under subsection (a)(2). Replacement reserves shall be paid with |
|---|
| 976 | | - | 29.19respect to a unit commencing as of the later of (1) the date of creation of the common interest |
|---|
| 977 | | - | 29.20community or (2) the date that the structure and exterior of the building containing the unit, |
|---|
| 978 | | - | 29.21or the structure and exterior of any building located within the unit boundaries, but excluding |
|---|
| 979 | | - | 29.22the interior finishing of the structure itself, are substantially completed. If the association |
|---|
| 980 | | - | 29.23has not approved an annual budget as of the commencement date for the payment of |
|---|
| 981 | | - | 29.24replacement reserves, then the reserves shall be paid based upon the budget contained in |
|---|
| 982 | | - | 29.25the disclosure statement required by section 515B.4-102. |
|---|
| 983 | | - | 29.26 (c) After an assessment has been levied by the association, assessments shall be levied |
|---|
| 984 | | - | 29.27at least annually, based upon an annual budget approved by the association. In addition to |
|---|
| 985 | | - | 29.28and not in lieu of annual assessments, an association may, if so provided in the declaration, |
|---|
| 986 | | - | 29.29levy special assessments against all units in the common interest community based upon |
|---|
| 987 | | - | 29.30the same formula required by the declaration for levying annual assessments. Special |
|---|
| 988 | | - | 29.31assessments may be levied only (1) to cover expenditures of an emergency nature, (2) to |
|---|
| 989 | | - | 29.32replenish underfunded replacement reserves, (3) to cover unbudgeted capital expenditures |
|---|
| 990 | | - | 29.33or operating expenses, or (4) to replace certain components of the common interest |
|---|
| 991 | | - | 29.34community described in section 515B.3-114(a), if such alternative method of funding is |
|---|
| 992 | | - | 29.35approved under section 515B.3-114(a)(5). The association may also levy assessments against |
|---|
| 993 | | - | 29Article 1 Sec. 11. |
|---|
| 994 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 30.1fewer than all units as provided in subsections (e), (f), and (g). An assessment under |
|---|
| 995 | | - | 30.2subsection (e)(2) for replacement reserves is subject to the requirements of section |
|---|
| 996 | | - | 30.3515B.3-1141(a)(5). |
|---|
| 997 | | - | 30.4 (d) Except as modified by subsections (a), clauses paragraphs (1) and (2), (e), (f), and |
|---|
| 998 | | - | 30.5(g), all common expenses shall be assessed against all the units in accordance with the |
|---|
| 999 | | - | 30.6allocations established by the declaration pursuant to section 515B.2-108. |
|---|
| 1000 | | - | 30.7 (e) Unless otherwise required by the declaration: |
|---|
| 1001 | | - | 30.8 (1) any common expense associated with the maintenance, repair, or replacement of a |
|---|
| 1002 | | - | 30.9limited common element shall be assessed against the units to which that limited common |
|---|
| 1003 | | - | 30.10element is assigned, equally, or in any other proportion the declaration provides; |
|---|
| 1004 | | - | 30.11 (2) any common expense or portion thereof benefiting fewer than all of the units may |
|---|
| 1005 | | - | 30.12be assessed exclusively against the units benefited, equally, or in any other proportion the |
|---|
| 1006 | | - | 30.13declaration provides; |
|---|
| 1007 | | - | 30.14 (3) the costs of insurance may be assessed in proportion to risk or coverage, and the |
|---|
| 1008 | | - | 30.15costs of utilities may be assessed in proportion to usage; |
|---|
| 1009 | | - | 30.16 (4) subject to subsection (k) and section 515B.3-102(a)(11), reasonable attorney fees |
|---|
| 1010 | | - | 30.17and costs incurred by the association in connection with (i) the collection of assessments, |
|---|
| 1011 | | - | 30.18and (ii) the enforcement of this chapter, the articles, bylaws, declaration, or rules and |
|---|
| 1012 | | - | 30.19regulations, against a unit owner, may be assessed against the unit owner's unit, subject to |
|---|
| 1013 | | - | 30.20section 515B.3-116(h), provided that the attorney fees and costs for enforcement and |
|---|
| 1014 | | - | 30.21collection may not exceed $1,500 and no fees or costs may be assessed if the association |
|---|
| 1015 | | - | 30.22uses a collection agency as defined in section 332.31 if the fees of the collection agency are |
|---|
| 1016 | | - | 30.23contingent on the amount collected; and |
|---|
| 1017 | | - | 30.24 (5) subject to subsection (k), fees, charges, late charges, and fines, and interest may be |
|---|
| 1018 | | - | 30.25assessed as provided in section 515B.3-116(a). |
|---|
| 1019 | | - | 30.26 (f) Assessments levied under section 515B.3-116 to pay a judgment against the association |
|---|
| 1020 | | - | 30.27may be levied only against the units in the common interest community at the time the |
|---|
| 1021 | | - | 30.28judgment was entered, in proportion to their common expense liabilities. |
|---|
| 1022 | | - | 30.29 (g) If any damage to the common elements or another unit is caused by the act or omission |
|---|
| 1023 | | - | 30.30of any unit owner, or occupant of a unit, or their invitees, the association may assess the |
|---|
| 1024 | | - | 30.31costs of repairing the damage exclusively against the unit owner's unit to the extent not |
|---|
| 1025 | | - | 30.32covered by insurance. |
|---|
| 1026 | | - | 30Article 1 Sec. 11. |
|---|
| 1027 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 31.1 (h) Subject to any shorter period specified by the declaration or bylaws, if any installment |
|---|
| 1028 | | - | 31.2of an assessment becomes more than 60 days past due, then the association may, upon ten |
|---|
| 1029 | | - | 31.3days' written notice to the unit owner, declare the entire amount of the assessment |
|---|
| 1030 | | - | 31.4immediately due and payable in full, except that any portion of the assessment that represents |
|---|
| 1031 | | - | 31.5installments that are not due and payable without acceleration as of the date of reinstatement |
|---|
| 1032 | | - | 31.6must not be included in the amount that a unit owner must pay to reinstate under section |
|---|
| 1033 | | - | 31.7580.30 or chapter 581. |
|---|
| 1034 | | - | 31.8 (i) If common expense liabilities are reallocated for any purpose authorized by this |
|---|
| 1035 | | - | 31.9chapter, common expense assessments and any installment thereof not yet due shall be |
|---|
| 1036 | | - | 31.10recalculated in accordance with the reallocated common expense liabilities. |
|---|
| 1037 | | - | 31.11 (j) An assessment against fewer than all of the units must be levied within three years |
|---|
| 1038 | | - | 31.12after the event or circumstances forming the basis for the assessment, or shall be barred. |
|---|
| 1039 | | - | 31.13 (k) An association must offer a unit owner a reasonable payment agreement and take |
|---|
| 1040 | | - | 31.14into consideration the financial circumstances of the unit owner. |
|---|
| 1041 | | - | 31.15 (k) (l) This section applies only to common interest communities created on or after |
|---|
| 1042 | | - | 31.16August 1, 2010. |
|---|
| 1043 | | - | 31.17 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1044 | | - | 31.18Sec. 12. Minnesota Statutes 2024, section 515B.3-116, is amended to read: |
|---|
| 1045 | | - | 31.19 515B.3-116 LIEN FOR ASSESSMENTS. |
|---|
| 1046 | | - | 31.20 (a) The association has a lien on a unit for any assessment levied against that unit from |
|---|
| 1047 | | - | 31.21the time the assessment becomes due. If an assessment is payable in installments, the full |
|---|
| 1048 | | - | 31.22amount of the assessment is a lien from the time the first installment thereof becomes due. |
|---|
| 1049 | | - | 31.23Unless the declaration otherwise provides, fees, charges, and late charges, fines and interest |
|---|
| 1050 | | - | 31.24charges pursuant to section 515B.3-102(a)(10), (11) and (12) are liens, and are enforceable |
|---|
| 1051 | | - | 31.25as assessments, under this section. Recording of the declaration constitutes record notice |
|---|
| 1052 | | - | 31.26and perfection of any assessment lien under this section, and no further recording of any |
|---|
| 1053 | | - | 31.27notice of or claim for the lien is required. |
|---|
| 1054 | | - | 31.28 (b) Subject to subsection (c), a lien under this section is prior to all other liens and |
|---|
| 1055 | | - | 31.29encumbrances on a unit except (i) liens and encumbrances recorded before the declaration |
|---|
| 1056 | | - | 31.30and, in a cooperative, liens and encumbrances which the association creates, assumes, or |
|---|
| 1057 | | - | 31.31takes subject to, (ii) any first mortgage encumbering the fee simple interest in the unit, or, |
|---|
| 1058 | | - | 31.32in a cooperative, any first security interest encumbering only the unit owner's interest in the |
|---|
| 1059 | | - | 31.33unit, (iii) liens for real estate taxes and other governmental assessments or charges against |
|---|
| 1060 | | - | 31Article 1 Sec. 12. |
|---|
| 1061 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 32.1the unit, and (iv) a master association lien under section 515B.2-121(h). This subsection |
|---|
| 1062 | | - | 32.2shall not affect the priority of mechanic's liens. |
|---|
| 1063 | | - | 32.3 (c) If a first mortgage on a unit is foreclosed, the first mortgage was recorded after June |
|---|
| 1064 | | - | 32.41, 1994, and no owner or person who acquires the owner's interest in the unit redeems |
|---|
| 1065 | | - | 32.5pursuant to chapter 580, 581, or 582, the holder of the sheriff's certificate of sale from the |
|---|
| 1066 | | - | 32.6foreclosure of the first mortgage or any person who acquires title to the unit by redemption |
|---|
| 1067 | | - | 32.7as a junior creditor shall take title to the unit subject to a lien in favor of the association for |
|---|
| 1068 | | - | 32.8unpaid assessments for common expenses levied pursuant to section 515B.3-115(a), (e)(1) |
|---|
| 1069 | | - | 32.9to (3), (f), and (i) which became due, without acceleration, during the six months immediately |
|---|
| 1070 | | - | 32.10preceding the end of the owner's period of redemption. The common expenses shall be |
|---|
| 1071 | | - | 32.11based upon the association's then current annual budget, notwithstanding the use of an |
|---|
| 1072 | | - | 32.12alternate common expense plan under section 515B.3-115(a)(2). If a first security interest |
|---|
| 1073 | | - | 32.13encumbering a unit owner's interest in a cooperative unit which is personal property is |
|---|
| 1074 | | - | 32.14foreclosed, the secured party or the purchaser at the sale shall take title to the unit subject |
|---|
| 1075 | | - | 32.15to unpaid assessments for common expenses levied pursuant to section 515B.3-115(a), |
|---|
| 1076 | | - | 32.16(e)(1) to (3), (f), and (i) which became due, without acceleration, during the six months |
|---|
| 1077 | | - | 32.17immediately preceding the first day following either the disposition date pursuant to section |
|---|
| 1078 | | - | 32.18336.9-610 or the date on which the obligation of the unit owner is discharged pursuant to |
|---|
| 1079 | | - | 32.19section 336.9-622. |
|---|
| 1080 | | - | 32.20 (d) Proceedings to enforce an assessment lien shall be instituted within three years after |
|---|
| 1081 | | - | 32.21the last installment of the assessment becomes payable, or shall be barred. |
|---|
| 1082 | | - | 32.22 (e) The unit owner of a unit at the time an assessment is due shall be personally liable |
|---|
| 1083 | | - | 32.23to the association for payment of the assessment levied against the unit. If there are multiple |
|---|
| 1084 | | - | 32.24owners of the unit, they shall be jointly and severally liable. |
|---|
| 1085 | | - | 32.25 (f) This section does not prohibit actions to recover sums for which subsection (a) creates |
|---|
| 1086 | | - | 32.26a lien nor prohibit an association from taking a deed in lieu of foreclosure. |
|---|
| 1087 | | - | 32.27 (g) The association shall furnish to a unit owner or the owner's authorized agent upon |
|---|
| 1088 | | - | 32.28written request of the unit owner or the authorized agent a statement setting forth the amount |
|---|
| 1089 | | - | 32.29of unpaid assessments currently levied against the owner's unit. If the unit owner's interest |
|---|
| 1090 | | - | 32.30is real estate, the statement shall be in recordable form. The statement shall be furnished |
|---|
| 1091 | | - | 32.31within ten business days after receipt of the request and is binding on the association and |
|---|
| 1092 | | - | 32.32every unit owner. |
|---|
| 1093 | | - | 32.33 (h) The association's lien may be foreclosed as provided in this subsection. In no case |
|---|
| 1094 | | - | 32.34may an association's lien be foreclosed for unpaid fines. Not including attorney fees, when |
|---|
| 1095 | | - | 32Article 1 Sec. 12. |
|---|
| 1096 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 33.1unpaid fees, charges, and late charges are properly issued pursuant to section 515B.3-102, |
|---|
| 1097 | | - | 33.2subsection (a), paragraphs (10), (11), and (12), an association may begin a foreclosure when |
|---|
| 1098 | | - | 33.3the total amount owed is $5,000 or more and that amount has been outstanding for 180 days |
|---|
| 1099 | | - | 33.4or more. |
|---|
| 1100 | | - | 33.5 (1) In a condominium or planned community, the association's lien may be foreclosed |
|---|
| 1101 | | - | 33.6in a like manner as a mortgage containing a power of sale pursuant to chapter 580, or by |
|---|
| 1102 | | - | 33.7action pursuant to chapter 581. The association shall have a power of sale to foreclose the |
|---|
| 1103 | | - | 33.8lien pursuant to chapter 580, except that any portion of the assessment that represents |
|---|
| 1104 | | - | 33.9attorney fees or costs shall not be included in the amount a unit owner must pay to reinstate |
|---|
| 1105 | | - | 33.10under section 580.30 or chapter 581. |
|---|
| 1106 | | - | 33.11 (2) In a cooperative whose unit owners' interests are real estate, the association's lien |
|---|
| 1107 | | - | 33.12shall be foreclosed in a like manner as a mortgage on real estate as provided in paragraph |
|---|
| 1108 | | - | 33.13(1). |
|---|
| 1109 | | - | 33.14 (3) In a cooperative whose unit owners' interests in the units are personal property, the |
|---|
| 1110 | | - | 33.15association's lien shall be foreclosed in a like manner as a security interest under article 9 |
|---|
| 1111 | | - | 33.16of chapter 336. In any disposition pursuant to section 336.9-610 or retention pursuant to |
|---|
| 1112 | | - | 33.17sections 336.9-620 to 336.9-622, the rights of the parties shall be the same as those provided |
|---|
| 1113 | | - | 33.18by law, except (i) notice of sale, disposition, or retention shall be served on the unit owner |
|---|
| 1114 | | - | 33.1990 days prior to sale, disposition, or retention, (ii) the association shall be entitled to its |
|---|
| 1115 | | - | 33.20reasonable costs and attorney fees not exceeding the amount provided by section 582.01, |
|---|
| 1116 | | - | 33.21subdivision 1a, (iii) the amount of the association's lien shall be deemed to be adequate |
|---|
| 1117 | | - | 33.22consideration for the unit subject to disposition or retention, notwithstanding the value of |
|---|
| 1118 | | - | 33.23the unit, and (iv) the notice of sale, disposition, or retention shall contain the following |
|---|
| 1119 | | - | 33.24statement in capital letters with the name of the association or secured party filled in: |
|---|
| 1120 | | - | 33.25 "THIS IS TO INFORM YOU THAT BY THIS NOTICE (fill in name of association or |
|---|
| 1121 | | - | 33.26secured party) HAS BEGUN PROCEEDINGS UNDER MINNESOTA STATUTES, |
|---|
| 1122 | | - | 33.27CHAPTER 515B, TO FORECLOSE ON YOUR INTEREST IN YOUR UNIT FOR THE |
|---|
| 1123 | | - | 33.28REASON SPECIFIED IN THIS NOTICE. YOUR INTEREST IN YOUR UNIT WILL |
|---|
| 1124 | | - | 33.29TERMINATE 90 DAYS AFTER SERVICE OF THIS NOTICE ON YOU UNLESS |
|---|
| 1125 | | - | 33.30BEFORE THEN: |
|---|
| 1126 | | - | 33.31 (a) THE PERSON AUTHORIZED BY (fill in the name of association or secured party) |
|---|
| 1127 | | - | 33.32AND DESCRIBED IN THIS NOTICE TO RECEIVE PAYMENTS RECEIVES FROM |
|---|
| 1128 | | - | 33.33YOU: |
|---|
| 1129 | | - | 33.34 (1) THE AMOUNT THIS NOTICE SAYS YOU OWE; PLUS |
|---|
| 1130 | | - | 33Article 1 Sec. 12. |
|---|
| 1131 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 34.1 (2) THE COSTS INCURRED TO SERVE THIS NOTICE ON YOU; PLUS |
|---|
| 1132 | | - | 34.2 (3) $500 TO APPLY TO ATTORNEY FEES ACTUALLY EXPENDED OR |
|---|
| 1133 | | - | 34.3INCURRED; PLUS |
|---|
| 1134 | | - | 34.4 (4) ANY ADDITIONAL AMOUNTS FOR YOUR UNIT BECOMING DUE TO (fill |
|---|
| 1135 | | - | 34.5in name of association or secured party) AFTER THE DATE OF THIS NOTICE; OR |
|---|
| 1136 | | - | 34.6 (b) YOU SECURE FROM A DISTRICT COURT AN ORDER THAT THE |
|---|
| 1137 | | - | 34.7FORECLOSURE OF YOUR RIGHTS TO YOUR UNIT BE SUSPENDED UNTIL YOUR |
|---|
| 1138 | | - | 34.8CLAIMS OR DEFENSES ARE FINALLY DISPOSED OF BY TRIAL, HEARING, OR |
|---|
| 1139 | | - | 34.9SETTLEMENT. YOUR ACTION MUST SPECIFICALLY STATE THOSE FACTS AND |
|---|
| 1140 | | - | 34.10GROUNDS THAT DEMONSTRATE YOUR CLAIMS OR DEFENSES. |
|---|
| 1141 | | - | 34.11 IF YOU DO NOT DO ONE OR THE OTHER OF THE ABOVE THINGS WITHIN |
|---|
| 1142 | | - | 34.12THE TIME PERIOD SPECIFIED IN THIS NOTICE, YOUR OWNERSHIP RIGHTS IN |
|---|
| 1143 | | - | 34.13YOUR UNIT WILL TERMINATE AT THE END OF THE PERIOD, YOU WILL LOSE |
|---|
| 1144 | | - | 34.14ALL THE MONEY YOU HAVE PAID FOR YOUR UNIT, YOU WILL LOSE YOUR |
|---|
| 1145 | | - | 34.15RIGHT TO POSSESSION OF YOUR UNIT, YOU MAY LOSE YOUR RIGHT TO |
|---|
| 1146 | | - | 34.16ASSERT ANY CLAIMS OR DEFENSES THAT YOU MIGHT HAVE, AND YOU WILL |
|---|
| 1147 | | - | 34.17BE EVICTED. IF YOU HAVE ANY QUESTIONS ABOUT THIS NOTICE, CONTACT |
|---|
| 1148 | | - | 34.18AN ATTORNEY IMMEDIATELY." |
|---|
| 1149 | | - | 34.19 (4) In any foreclosure pursuant to chapter 580, 581, or 582, the rights of the parties shall |
|---|
| 1150 | | - | 34.20be the same as those provided by law, except (i) the period of redemption for unit owners |
|---|
| 1151 | | - | 34.21shall be six months from the date of sale or a lesser period authorized by law, (ii) in a |
|---|
| 1152 | | - | 34.22foreclosure by advertisement under chapter 580, the foreclosing party shall be entitled to |
|---|
| 1153 | | - | 34.23costs and disbursements of foreclosure and attorney fees authorized by the declaration or |
|---|
| 1154 | | - | 34.24bylaws, notwithstanding the provisions of section 582.01, subdivisions 1 and 1a, as specified |
|---|
| 1155 | | - | 34.25in section 582.01, subdivision 1, up to a maximum of $1,000, (iii) in a foreclosure by action |
|---|
| 1156 | | - | 34.26under chapter 581, the foreclosing party shall be entitled to costs and disbursements of |
|---|
| 1157 | | - | 34.27foreclosure and attorney fees as the court shall determine, and (iv) the amount of the |
|---|
| 1158 | | - | 34.28association's lien shall be deemed to be adequate consideration for the unit subject to |
|---|
| 1159 | | - | 34.29foreclosure, notwithstanding the value of the unit. |
|---|
| 1160 | | - | 34.30 (i) If a holder of a sheriff's certificate of sale, prior to the expiration of the period of |
|---|
| 1161 | | - | 34.31redemption, pays any past due or current assessments, or any other charges lienable as |
|---|
| 1162 | | - | 34.32assessments, with respect to the unit described in the sheriff's certificate, then the amount |
|---|
| 1163 | | - | 34.33paid shall be a part of the sum required to be paid to redeem under section 582.03. |
|---|
| 1164 | | - | 34Article 1 Sec. 12. |
|---|
| 1165 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 35.1 (j) In a cooperative, if the unit owner fails to redeem before the expiration of the |
|---|
| 1166 | | - | 35.2redemption period in a foreclosure of the association's assessment lien, the association may |
|---|
| 1167 | | - | 35.3bring an action for eviction against the unit owner and any persons in possession of the unit, |
|---|
| 1168 | | - | 35.4and in that case section 504B.291 shall not apply. |
|---|
| 1169 | | - | 35.5 (k) An association may assign its lien rights in the same manner as any other secured |
|---|
| 1170 | | - | 35.6party. |
|---|
| 1171 | | - | 35.7 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1172 | | - | 35.8 Sec. 13. [515B.3-122] REQUIREMENT TO MEET AND CONFER. |
|---|
| 1173 | | - | 35.9 Subdivision 1.Enforcement action defined.For the purposes of this section, |
|---|
| 1174 | | - | 35.10"enforcement action" means any attempt by an association, management company, or an |
|---|
| 1175 | | - | 35.11attorney or other person on behalf of the association or management company, to collect a |
|---|
| 1176 | | - | 35.12disputed assessment, fine, late fee, or other charge, or a civil action or proceeding, other |
|---|
| 1177 | | - | 35.13than a cross-complaint, involving rights, duties, or liabilities under this chapter or any other |
|---|
| 1178 | | - | 35.14law, or the governing documents of a common interest community or association, including |
|---|
| 1179 | | - | 35.15the foreclosure of an association's lien pursuant to section 515B.3-116. |
|---|
| 1180 | | - | 35.16 Subd. 2.Meet and confer process.Prior to an association taking any enforcement |
|---|
| 1181 | | - | 35.17action, the association and the unit owner must engage in a meet and confer process in an |
|---|
| 1182 | | - | 35.18effort to resolve any dispute between the association and the unit owner involving their |
|---|
| 1183 | | - | 35.19respective rights, duties, or liabilities under this chapter or any other section of law, or under |
|---|
| 1184 | | - | 35.20the governing documents of the common interest community or association. The association's |
|---|
| 1185 | | - | 35.21board must designate a member of the board to meet and confer with the unit owner. The |
|---|
| 1186 | | - | 35.22parties must meet as soon as practicable at a mutually convenient time and place. At the |
|---|
| 1187 | | - | 35.23meeting, each party must be given reasonable time to present their positions and must confer |
|---|
| 1188 | | - | 35.24in good faith to seek a resolution to the dispute. If the meet and confer process results in |
|---|
| 1189 | | - | 35.25the resolution of the dispute, the resolution must be in writing and signed by both a board |
|---|
| 1190 | | - | 35.26member and the unit owner. The signed agreement binds the parties and is judicially |
|---|
| 1191 | | - | 35.27enforceable. A unit owner must not be charged any fees, including any attorney fees, to |
|---|
| 1192 | | - | 35.28participate in the meet and confer process. |
|---|
| 1193 | | - | 35.29 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1194 | | - | 35.30Sec. 14. [515B.3-125] LEGAL FEES; NOTICE REQUIRED. |
|---|
| 1195 | | - | 35.31 (a) Prior to referring a unit owner's inquiry to an attorney, the board must provide a |
|---|
| 1196 | | - | 35.32notice to the unit owner with the following information: |
|---|
| 1197 | | - | 35Article 1 Sec. 14. |
|---|
| 1198 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 36.1 (1) a statement that the board plans to refer the matter at issue to an attorney; |
|---|
| 1199 | | - | 36.2 (2) the name of the person responsible for payment of any resulting legal fees; and |
|---|
| 1200 | | - | 36.3 (3) an estimate of the legal fees the attorney may charge or has charged for similar work. |
|---|
| 1201 | | - | 36.4 (b) The board must provide the notification under subsection (a) at no cost to the unit |
|---|
| 1202 | | - | 36.5owner. |
|---|
| 1203 | | - | 36.6 (c) The board must provide to a unit owner an itemized invoice for any legal fees charged |
|---|
| 1204 | | - | 36.7to the unit owner detailing the attorney's rate, the time the attorney spent on the matter, the |
|---|
| 1205 | | - | 36.8specific services the attorney provided, and the date or dates of service. |
|---|
| 1206 | | - | 36.9 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1207 | | - | 36.10Sec. 15. Minnesota Statutes 2024, section 515B.4-102, is amended to read: |
|---|
| 1208 | | - | 36.11 515B.4-102 DISCLOSURE STATEMENT; GENERAL PROVISIONS; CIC |
|---|
| 1209 | | - | 36.12CREATED BEFORE AUGUST 1, 2010. |
|---|
| 1210 | | - | 36.13 (a) A disclosure statement shall fully and accurately disclose: |
|---|
| 1211 | | - | 36.14 (1) the name and, if available, the number of the common interest community; |
|---|
| 1212 | | - | 36.15 (2) the name and principal address of the declarant; |
|---|
| 1213 | | - | 36.16 (3) the number of units which the declarant has the right to include in the common |
|---|
| 1214 | | - | 36.17interest community and a statement that the common interest community is either a |
|---|
| 1215 | | - | 36.18condominium, cooperative, or planned community; |
|---|
| 1216 | | - | 36.19 (4) a general description of the common interest community, including, at a minimum, |
|---|
| 1217 | | - | 36.20(i) the number of buildings, (ii) the number of dwellings per building, (iii) the type of |
|---|
| 1218 | | - | 36.21construction, (iv) whether the common interest community involves new construction or |
|---|
| 1219 | | - | 36.22rehabilitation, (v) whether any building was wholly or partially occupied, for any purpose, |
|---|
| 1220 | | - | 36.23before it was added to the common interest community and the nature of the occupancy, |
|---|
| 1221 | | - | 36.24and (vi) a general description of any roads, trails, or utilities that are located on the common |
|---|
| 1222 | | - | 36.25elements and that the association or a master association will be required to maintain; |
|---|
| 1223 | | - | 36.26 (5) declarant's schedule of commencement and completion of construction of any |
|---|
| 1224 | | - | 36.27buildings and other improvements that the declarant is obligated to build pursuant to section |
|---|
| 1225 | | - | 36.28515B.4-117; |
|---|
| 1226 | | - | 36.29 (6) any expenses or services, not reflected in the budget, that a declarant pays or provides, |
|---|
| 1227 | | - | 36.30which may become a common expense; the projected common expense attributable to each |
|---|
| 1228 | | - | 36Article 1 Sec. 15. |
|---|
| 1229 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 37.1of those expenses or services; and an explanation of declarant's limited assessment liability |
|---|
| 1230 | | - | 37.2under section 515B.3-115(b); |
|---|
| 1231 | | - | 37.3 (7) any initial or special fee due from the purchaser to the declarant or the association |
|---|
| 1232 | | - | 37.4at closing, together with a description of the purpose and method of calculating the fee; |
|---|
| 1233 | | - | 37.5 (8) identification of any liens, defects, or encumbrances which will continue to affect |
|---|
| 1234 | | - | 37.6the title to a unit or to any real property owned by the association after the contemplated |
|---|
| 1235 | | - | 37.7conveyance; |
|---|
| 1236 | | - | 37.8 (9) a description of any financing offered or arranged by the declarant; |
|---|
| 1237 | | - | 37.9 (10) a statement as to whether application has been made for any project approvals for |
|---|
| 1238 | | - | 37.10the common interest community from the Federal National Mortgage Association (FNMA), |
|---|
| 1239 | | - | 37.11Federal Home Loan Mortgage Corporation (FHLMC), Department of Housing and Urban |
|---|
| 1240 | | - | 37.12Development (HUD) or Department of Veterans Affairs (VA), and which, if any, such final |
|---|
| 1241 | | - | 37.13approvals have been received; |
|---|
| 1242 | | - | 37.14 (11) the terms of any warranties provided by the declarant, including copies of sections |
|---|
| 1243 | | - | 37.15515B.4-112 through 515B.4-115, and any other applicable statutory warranties, and a |
|---|
| 1244 | | - | 37.16statement of any limitations on the enforcement of the applicable warranties or on damages; |
|---|
| 1245 | | - | 37.17 (12) a statement that: (i) within ten days after the receipt of a disclosure statement, a |
|---|
| 1246 | | - | 37.18purchaser may cancel any contract for the purchase of a unit from a declarant; provided, |
|---|
| 1247 | | - | 37.19that the right to cancel terminates upon the purchaser's voluntary acceptance of a conveyance |
|---|
| 1248 | | - | 37.20of the unit from the declarant or by the purchaser agreeing to modify or waive the right to |
|---|
| 1249 | | - | 37.21cancel in the manner provided by section 515B.4-106(a); (ii) if a purchaser receives a |
|---|
| 1250 | | - | 37.22disclosure statement more than ten days before signing a purchase agreement, the purchaser |
|---|
| 1251 | | - | 37.23cannot cancel the purchase agreement; and (iii) if a declarant obligated to deliver a disclosure |
|---|
| 1252 | | - | 37.24statement fails to deliver a disclosure statement which substantially complies with this |
|---|
| 1253 | | - | 37.25chapter to a purchaser to whom a unit is conveyed, the declarant shall be liable to the |
|---|
| 1254 | | - | 37.26purchaser as provided in section 515B.4-106(d); |
|---|
| 1255 | | - | 37.27 (13) a statement disclosing to the extent of the declarant's or an affiliate of a declarant's |
|---|
| 1256 | | - | 37.28actual knowledge, after reasonable inquiry, any unsatisfied judgments or lawsuits to which |
|---|
| 1257 | | - | 37.29the association is a party, and the status of those lawsuits which are material to the common |
|---|
| 1258 | | - | 37.30interest community or the unit being purchased; |
|---|
| 1259 | | - | 37.31 (14) a statement (i) describing the conditions under which earnest money will be held |
|---|
| 1260 | | - | 37.32in and disbursed from the escrow account, as set forth in section 515B.4-109, (ii) that the |
|---|
| 1261 | | - | 37Article 1 Sec. 15. |
|---|
| 1262 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 38.1earnest money will be returned to the purchaser if the purchaser cancels the contract pursuant |
|---|
| 1263 | | - | 38.2to section 515B.4-106, and (iii) setting forth the name and address of the escrow agent; |
|---|
| 1264 | | - | 38.3 (15) a detailed description of the insurance coverage provided by the association for the |
|---|
| 1265 | | - | 38.4benefit of unit owners, including a statement as to which, if any, of the items referred to in |
|---|
| 1266 | | - | 38.5section 515B.3-113, subsection (b), are insured by the association; |
|---|
| 1267 | | - | 38.6 (16) any current or expected fees or charges, other than assessments for common |
|---|
| 1268 | | - | 38.7expenses, to be paid by unit owners for the use of the common elements or any other |
|---|
| 1269 | | - | 38.8improvements or facilities; |
|---|
| 1270 | | - | 38.9 (17) the financial arrangements, including any contingencies, which have been made to |
|---|
| 1271 | | - | 38.10provide for completion of all improvements that the declarant is obligated to build pursuant |
|---|
| 1272 | | - | 38.11to section 515B.4-118, or a statement that no such arrangements have been made; |
|---|
| 1273 | | - | 38.12 (18) in a cooperative: (i) whether the unit owners will be entitled for federal and state |
|---|
| 1274 | | - | 38.13tax purposes, to deduct payments made by the association for real estate taxes and interest |
|---|
| 1275 | | - | 38.14paid to the holder of a security interest encumbering the cooperative; (ii) a statement as to |
|---|
| 1276 | | - | 38.15the effect on the unit owners if the association fails to pay real estate taxes or payments due |
|---|
| 1277 | | - | 38.16the holder of a security interest encumbering the cooperative; and (iii) the principal amount |
|---|
| 1278 | | - | 38.17and a general description of the terms of any blanket mortgage, contract for deed, or other |
|---|
| 1279 | | - | 38.18blanket security instrument encumbering the cooperative property; |
|---|
| 1280 | | - | 38.19 (19) a statement: (i) that real estate taxes for the unit or any real property owned by the |
|---|
| 1281 | | - | 38.20association are not delinquent or, if there are delinquent real estate taxes, describing the |
|---|
| 1282 | | - | 38.21property for which the taxes are delinquent, stating the amount of the delinquent taxes, |
|---|
| 1283 | | - | 38.22interest and penalties, and stating the years for which taxes are delinquent, and (ii) setting |
|---|
| 1284 | | - | 38.23forth the amount of real estate taxes, including the amount of any special assessment certified |
|---|
| 1285 | | - | 38.24for payment with the real estate taxes, due and payable with respect to the unit in the year |
|---|
| 1286 | | - | 38.25in which the disclosure statement is given, if real estate taxes have been separately assessed |
|---|
| 1287 | | - | 38.26against the unit; |
|---|
| 1288 | | - | 38.27 (20) if the association or the purchaser of the unit will be a member of a master |
|---|
| 1289 | | - | 38.28association, a statement to that effect, and all of the following information with respect to |
|---|
| 1290 | | - | 38.29the master association: (i) a copy of the master declaration, the articles of incorporation, |
|---|
| 1291 | | - | 38.30bylaws, and rules and regulations for the master association, together with any amendments |
|---|
| 1292 | | - | 38.31thereto; (ii) the name, address and general description of the master association, including |
|---|
| 1293 | | - | 38.32a general description of any other association, unit owners, or other persons which are or |
|---|
| 1294 | | - | 38.33may become members; (iii) a description of any nonresidential use permitted on any property |
|---|
| 1295 | | - | 38.34subject to the master association; (iv) a statement as to the estimated maximum number of |
|---|
| 1296 | | - | 38Article 1 Sec. 15. |
|---|
| 1297 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 39.1associations, unit owners or other persons which may become members of the master |
|---|
| 1298 | | - | 39.2association, and the degree and period of control of the master association by a declarant |
|---|
| 1299 | | - | 39.3or other person; (v) a description of any facilities intended for the benefit of the members |
|---|
| 1300 | | - | 39.4of the master association and not located on property owned or controlled by a member or |
|---|
| 1301 | | - | 39.5the master association; (vi) the financial arrangements, including any contingencies, which |
|---|
| 1302 | | - | 39.6have been made to provide for completion of the facilities referred to in subsection (v), or |
|---|
| 1303 | | - | 39.7a statement that no arrangements have been made; (vii) any current balance sheet of the |
|---|
| 1304 | | - | 39.8master association and a projected or current annual budget, as applicable, which budget |
|---|
| 1305 | | - | 39.9shall include with respect to the master association those items in paragraph (23), clauses |
|---|
| 1306 | | - | 39.10(i) through (iii), and the projected monthly common expense assessment for each type of |
|---|
| 1307 | | - | 39.11unit, lot, or other parcel of real estate which is or is planned to be subject to assessment; |
|---|
| 1308 | | - | 39.12(viii) a description of any expenses or services not reflected in the budget, paid for or |
|---|
| 1309 | | - | 39.13provided by a declarant or a person executing the master declaration, which may become |
|---|
| 1310 | | - | 39.14an expense of the master association in the future; (ix) a description of any powers delegated |
|---|
| 1311 | | - | 39.15to and accepted by the master association pursuant to section 515B.2-121(f)(2); (x) |
|---|
| 1312 | | - | 39.16identification of any liens, defects or encumbrances that will continue to affect title to |
|---|
| 1313 | | - | 39.17property owned or operated by the master association for the benefit of its members; (xi) |
|---|
| 1314 | | - | 39.18the terms of any warranties provided by any person for construction of facilities in which |
|---|
| 1315 | | - | 39.19the members of the master association have or may have an interest, and any known defects |
|---|
| 1316 | | - | 39.20in the facilities which would violate the standards described in section 515B.4-112(b); (xii) |
|---|
| 1317 | | - | 39.21a statement disclosing, after inquiry of the master association, any unsatisfied judgments |
|---|
| 1318 | | - | 39.22or lawsuits to which the master association is a party, and the status of those lawsuits which |
|---|
| 1319 | | - | 39.23are material to the master association; (xiii) a description of any insurance coverage provided |
|---|
| 1320 | | - | 39.24for the benefit of its members by the master association; and (xiv) any current or expected |
|---|
| 1321 | | - | 39.25fees or charges, other than assessments by the master association, to be paid by members |
|---|
| 1322 | | - | 39.26of the master association for the use of any facilities intended for the benefit of the members; |
|---|
| 1323 | | - | 39.27 (21) a statement as to whether the unit will be substantially completed at the time of |
|---|
| 1324 | | - | 39.28conveyance to a purchaser, and if not substantially completed, who is responsible to complete |
|---|
| 1325 | | - | 39.29and pay for the construction of the unit; |
|---|
| 1326 | | - | 39.30 (22) a copy of the declaration and any amendments thereto (exclusive of the CIC plat); |
|---|
| 1327 | | - | 39.31any other recorded covenants, conditions, restrictions, or reservations affecting the common |
|---|
| 1328 | | - | 39.32interest community; the articles of incorporation, bylaws and any rules or regulations of the |
|---|
| 1329 | | - | 39.33association; any agreement excluding or modifying any implied warranties; any agreement |
|---|
| 1330 | | - | 39.34reducing the statute of limitations for the enforcement of warranties; any contracts or leases |
|---|
| 1331 | | - | 39.35to be signed by purchaser at closing; and a brief narrative description of any (i) contracts |
|---|
| 1332 | | - | 39Article 1 Sec. 15. |
|---|
| 1333 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 40.1or leases that are or may be subject to cancellation by the association under section |
|---|
| 1334 | | - | 40.2515B.3-105 and (ii) any material agreements entered into between the declarant and a |
|---|
| 1335 | | - | 40.3governmental entity that affect the common interest community; and |
|---|
| 1336 | | - | 40.4 (23) a balance sheet for the association, current within 90 days; a projected annual budget |
|---|
| 1337 | | - | 40.5for the association; and a statement identifying the party responsible for the preparation of |
|---|
| 1338 | | - | 40.6the budget. The budget shall assume that all units intended to be included in the common |
|---|
| 1339 | | - | 40.7interest community, based upon the declarant's good faith estimate, have been subjected to |
|---|
| 1340 | | - | 40.8the declaration; provided, that additional budget portrayals based upon a lesser number of |
|---|
| 1341 | | - | 40.9units are permitted. The budget shall include, without limitation: (i) a statement of the |
|---|
| 1342 | | - | 40.10amount included in the budget as a reserve for replacement; (ii) a statement of any other |
|---|
| 1343 | | - | 40.11reserves; (iii) the projected common expense for each category of expenditures for the |
|---|
| 1344 | | - | 40.12association; (iv) the projected monthly common expense assessment for each type of unit; |
|---|
| 1345 | | - | 40.13and (v) a footnote or other reference to those components of the common interest community |
|---|
| 1346 | | - | 40.14the maintenance, repair, or replacement of which the budget assumes will be funded by |
|---|
| 1347 | | - | 40.15assessments under section 515B.3-115(e), rather than by assessments included in the |
|---|
| 1348 | | - | 40.16association's annual budget, and a statement referencing section 515B.3-115(e)(1) or (2), |
|---|
| 1349 | | - | 40.17as the source of funding. If, based upon the association's then current budget, the monthly |
|---|
| 1350 | | - | 40.18common expense assessment for the unit at the time of conveyance to the purchaser is |
|---|
| 1351 | | - | 40.19anticipated to exceed the monthly assessment stated in the budget, a statement to such effect |
|---|
| 1352 | | - | 40.20shall be included; |
|---|
| 1353 | | - | 40.21 (24) a copy of any fact sheet or other publication by the attorney general and the |
|---|
| 1354 | | - | 40.22Community Association Institute that describes, in plain language, common interest |
|---|
| 1355 | | - | 40.23communities and homeowner associations and explains the rights and responsibilities of |
|---|
| 1356 | | - | 40.24unit owners and associations; and |
|---|
| 1357 | | - | 40.25 (25) the schedules of fines required under section 515B.3-102, subsections (a), paragraph |
|---|
| 1358 | | - | 40.26(10), and (c). |
|---|
| 1359 | | - | 40.27 (b) A declarant shall promptly amend the disclosure statement to reflect any material |
|---|
| 1360 | | - | 40.28change in the information required by this chapter. |
|---|
| 1361 | | - | 40.29 (c) The master association, within ten days after a request by a declarant, a holder of |
|---|
| 1362 | | - | 40.30declarant rights, or a buyer referred to in section 515B.4-101(e), or the authorized |
|---|
| 1363 | | - | 40.31representative of any of them, shall furnish the information required to be provided by |
|---|
| 1364 | | - | 40.32subsection (a)(20). A declarant or other person who provides information pursuant to |
|---|
| 1365 | | - | 40.33subsection (a)(20) is not liable to the buyer for any erroneous information if the declarant |
|---|
| 1366 | | - | 40.34or other person: (i) is not an affiliate of or related in any way to a person authorized to |
|---|
| 1367 | | - | 40Article 1 Sec. 15. |
|---|
| 1368 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 41.1appoint the master association board pursuant to section 515B.2-121(c)(3), and (ii) has no |
|---|
| 1369 | | - | 41.2actual knowledge that the information is incorrect. |
|---|
| 1370 | | - | 41.3 (d) This section applies only to common interest communities created before August 1, |
|---|
| 1371 | | - | 41.42010. |
|---|
| 1372 | | - | 41.5 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1373 | | - | 41.6 Sec. 16. Minnesota Statutes 2024, section 515B.4-1021, is amended to read: |
|---|
| 1374 | | - | 41.7 515B.4-1021 DISCLOSURE STATEMENT; GENERAL PROVISIONS; CIC |
|---|
| 1375 | | - | 41.8CREATED ON OR AFTER AUGUST 1, 2010. |
|---|
| 1376 | | - | 41.9 (a) A disclosure statement shall fully and accurately disclose: |
|---|
| 1377 | | - | 41.10 (1) the name and, if available, the number of the common interest community; |
|---|
| 1378 | | - | 41.11 (2) the name and principal address of each declarant holding any special declarant rights; |
|---|
| 1379 | | - | 41.12a description of the special declarant rights held by each declarant; a description of the units |
|---|
| 1380 | | - | 41.13or additional real estate to which the respective special declarant rights apply; and a copy |
|---|
| 1381 | | - | 41.14of any recorded transfer of special declarant rights pursuant to section 515B.3-104(a), or |
|---|
| 1382 | | - | 41.15any instrument recorded pursuant to section 515B.3-104(b), (g), or (h); |
|---|
| 1383 | | - | 41.16 (3) the total number of units which all declarants have the right to include in the common |
|---|
| 1384 | | - | 41.17interest community and a statement that the common interest community is either a |
|---|
| 1385 | | - | 41.18condominium, cooperative, or planned community; |
|---|
| 1386 | | - | 41.19 (4) a general description of the common interest community, including, at a minimum, |
|---|
| 1387 | | - | 41.20(i) the number of buildings, (ii) the number of dwellings per building, (iii) the type of |
|---|
| 1388 | | - | 41.21construction, (iv) whether the common interest community involves new construction or |
|---|
| 1389 | | - | 41.22rehabilitation, (v) whether any building was wholly or partially occupied, for any purpose, |
|---|
| 1390 | | - | 41.23before it was added to the common interest community, and the nature of the occupancy, |
|---|
| 1391 | | - | 41.24(vi) a general description of any roads, trails, or utilities that are located on the common |
|---|
| 1392 | | - | 41.25elements and that the association or master association will be required to maintain, (vii) a |
|---|
| 1393 | | - | 41.26description of any declarant licensing rights under section 515B.2-109(e), and (viii) the |
|---|
| 1394 | | - | 41.27initial maintenance plan, initial maintenance schedule, and maintenance budget under section |
|---|
| 1395 | | - | 41.28515B.3-107(b). The initial maintenance plan prepared by the declarant must be based on |
|---|
| 1396 | | - | 41.29the best available information listing all building elements to which the plan will apply and |
|---|
| 1397 | | - | 41.30the generally accepted standards of maintenance on which the plan is based. The initial plan |
|---|
| 1398 | | - | 41.31must be dated and signed by the declarant and be fully funded by the initial budget provided |
|---|
| 1399 | | - | 41.32by the declarant; |
|---|
| 1400 | | - | 41Article 1 Sec. 16. |
|---|
| 1401 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 42.1 (5) declarant's schedule of commencement and completion of construction of any |
|---|
| 1402 | | - | 42.2buildings and other improvements that the declarant is obligated to build pursuant to section |
|---|
| 1403 | | - | 42.3515B.4-117; |
|---|
| 1404 | | - | 42.4 (6) any expenses or services, not reflected in the budget, that the declarant pays or |
|---|
| 1405 | | - | 42.5provides, which may become a common expense; the projected common expense attributable |
|---|
| 1406 | | - | 42.6to each of those expenses or services; a description of any alternate common expense plan |
|---|
| 1407 | | - | 42.7under section 515B.3-115(a)(2)(i); and, if the declaration provides for an alternate common |
|---|
| 1408 | | - | 42.8expense plan, either (i) a statement that the alternate common expense plan will have no |
|---|
| 1409 | | - | 42.9effect on the level of services or amenities anticipated by the association's budget or disclosed |
|---|
| 1410 | | - | 42.10in the disclosure statement, or (ii) a statement describing how the services or amenities may |
|---|
| 1411 | | - | 42.11be affected; |
|---|
| 1412 | | - | 42.12 (7) any initial or special fee due from the purchaser to the declarant or the association |
|---|
| 1413 | | - | 42.13at closing, together with a description of the purpose and method of calculating the fee; |
|---|
| 1414 | | - | 42.14 (8) identification of any liens, defects, or encumbrances which will continue to affect |
|---|
| 1415 | | - | 42.15the title to a unit or to any real property owned by the association after the contemplated |
|---|
| 1416 | | - | 42.16conveyance; |
|---|
| 1417 | | - | 42.17 (9) a description of any financing offered or arranged by the declarant; |
|---|
| 1418 | | - | 42.18 (10) a statement as to whether application has been made for any project approvals for |
|---|
| 1419 | | - | 42.19the common interest community from the Federal National Mortgage Association (FNMA), |
|---|
| 1420 | | - | 42.20Federal Home Loan Mortgage Corporation (FHLMC), Department of Housing and Urban |
|---|
| 1421 | | - | 42.21Development (HUD), or Department of Veterans Affairs (VA), and which, if any, such |
|---|
| 1422 | | - | 42.22final approvals have been received; |
|---|
| 1423 | | - | 42.23 (11) the terms of any warranties provided by the declarant, including copies of sections |
|---|
| 1424 | | - | 42.24515B.4-112 to 515B.4-115, and any other applicable statutory warranties, and a statement |
|---|
| 1425 | | - | 42.25of any limitations on the enforcement of the applicable warranties or on damages; |
|---|
| 1426 | | - | 42.26 (12) a statement that: |
|---|
| 1427 | | - | 42.27 (i) within ten days after the receipt of a disclosure statement, a purchaser may cancel |
|---|
| 1428 | | - | 42.28any contract for the purchase of a unit from a declarant; provided, that the right to cancel |
|---|
| 1429 | | - | 42.29terminates upon the purchaser's voluntary acceptance of a conveyance of the unit from the |
|---|
| 1430 | | - | 42.30declarant or by the purchaser agreeing to modify or waive the right to cancel in the manner |
|---|
| 1431 | | - | 42.31provided by section 515B.4-106(a); |
|---|
| 1432 | | - | 42.32 (ii) if a purchaser receives a disclosure statement more than ten days before signing a |
|---|
| 1433 | | - | 42.33purchase agreement, the purchaser cannot cancel the purchase agreement; and |
|---|
| 1434 | | - | 42Article 1 Sec. 16. |
|---|
| 1435 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 43.1 (iii) if a declarant obligated to deliver a disclosure statement fails to deliver a disclosure |
|---|
| 1436 | | - | 43.2statement which substantially complies with this chapter to a purchaser to whom a unit is |
|---|
| 1437 | | - | 43.3conveyed, the declarant shall be liable to the purchaser as provided in section 515B.4-106(d); |
|---|
| 1438 | | - | 43.4 (13) a statement disclosing to the extent of the declarant's or an affiliate of a declarant's |
|---|
| 1439 | | - | 43.5actual knowledge, after reasonable inquiry, any unsatisfied judgments or lawsuits to which |
|---|
| 1440 | | - | 43.6the association is a party, and the status of those lawsuits which are material to the common |
|---|
| 1441 | | - | 43.7interest community or the unit being purchased; |
|---|
| 1442 | | - | 43.8 (14) a statement (i) describing the conditions under which earnest money will be held |
|---|
| 1443 | | - | 43.9in and disbursed from the escrow account, as set forth in section 515B.4-109, (ii) that the |
|---|
| 1444 | | - | 43.10earnest money will be returned to the purchaser if the purchaser cancels the contract pursuant |
|---|
| 1445 | | - | 43.11to section 515B.4-106, and (iii) setting forth the name and address of the escrow agent; |
|---|
| 1446 | | - | 43.12 (15) a detailed description of the insurance coverage provided by the association for the |
|---|
| 1447 | | - | 43.13benefit of unit owners, including a statement as to which, if any, of the items referred to in |
|---|
| 1448 | | - | 43.14section 515B.3-113(b), are insured by the association; |
|---|
| 1449 | | - | 43.15 (16) any current or expected fees or charges, other than assessments for common |
|---|
| 1450 | | - | 43.16expenses, to be paid by unit owners for the use of the common elements or any other |
|---|
| 1451 | | - | 43.17improvements or facilities; |
|---|
| 1452 | | - | 43.18 (17) the financial arrangements, including any contingencies, which have been made to |
|---|
| 1453 | | - | 43.19provide for completion of all improvements that the declarant is obligated to build pursuant |
|---|
| 1454 | | - | 43.20to section 515B.4-118, or a statement that no such arrangements have been made; |
|---|
| 1455 | | - | 43.21 (18) in a cooperative: |
|---|
| 1456 | | - | 43.22 (i) whether the unit owners will be entitled, for federal and state tax purposes, to deduct |
|---|
| 1457 | | - | 43.23payments made by the association for real estate taxes and interest paid to the holder of a |
|---|
| 1458 | | - | 43.24security interest encumbering the cooperative; |
|---|
| 1459 | | - | 43.25 (ii) a statement as to the effect on the unit owners if the association fails to pay real estate |
|---|
| 1460 | | - | 43.26taxes or payments due the holder of a security interest encumbering the cooperative; and |
|---|
| 1461 | | - | 43.27 (iii) the principal amount and a general description of the terms of any blanket mortgage, |
|---|
| 1462 | | - | 43.28contract for deed, or other blanket security instrument encumbering the cooperative property; |
|---|
| 1463 | | - | 43.29 (19) a statement: |
|---|
| 1464 | | - | 43.30 (i) that real estate taxes for the unit or any real property owned by the association are |
|---|
| 1465 | | - | 43.31not delinquent or, if there are delinquent real estate taxes, describing the property for which |
|---|
| 1466 | | - | 43Article 1 Sec. 16. |
|---|
| 1467 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 44.1the taxes are delinquent, stating the amount of the delinquent taxes, interest, and penalties, |
|---|
| 1468 | | - | 44.2and stating the years for which taxes are delinquent; and |
|---|
| 1469 | | - | 44.3 (ii) setting forth the amount of real estate taxes, including the amount of any special |
|---|
| 1470 | | - | 44.4assessment certified for payment with the real estate taxes, due and payable with respect to |
|---|
| 1471 | | - | 44.5the unit in the year in which the disclosure statement is given, if real estate taxes have been |
|---|
| 1472 | | - | 44.6separately assessed against the unit; |
|---|
| 1473 | | - | 44.7 (20) if the unit or other parcel of real estate being purchased is or may be subject to a |
|---|
| 1474 | | - | 44.8master declaration at the time of the conveyance from the declarant to the purchaser, a |
|---|
| 1475 | | - | 44.9statement to that effect, and all of the following information with respect to the master |
|---|
| 1476 | | - | 44.10association: |
|---|
| 1477 | | - | 44.11 (i) copies of the following documents (which may be in proposed form if the master |
|---|
| 1478 | | - | 44.12declaration has not been recorded): the master declaration, the articles of incorporation, |
|---|
| 1479 | | - | 44.13bylaws, and rules and regulations for the master association, together with any amendments |
|---|
| 1480 | | - | 44.14thereto; |
|---|
| 1481 | | - | 44.15 (ii) the name and address of the master developer, and the name, address, and general |
|---|
| 1482 | | - | 44.16description of the master association, including a general description of any other association, |
|---|
| 1483 | | - | 44.17unit owners, or other persons which are or may become members; |
|---|
| 1484 | | - | 44.18 (iii) a description of any nonresidential use permitted on any property subject to the |
|---|
| 1485 | | - | 44.19master declaration; |
|---|
| 1486 | | - | 44.20 (iv) a statement as to the estimated maximum number of associations, unit owners, or |
|---|
| 1487 | | - | 44.21other persons which may become members of the master association, and a description of |
|---|
| 1488 | | - | 44.22any period of control of the master association and rights to appoint master association |
|---|
| 1489 | | - | 44.23directors by a master developer or other person pursuant to section 515B.2-121(c); |
|---|
| 1490 | | - | 44.24 (v) a description of any facilities intended for the benefit of the members of the master |
|---|
| 1491 | | - | 44.25association and not located on property owned or controlled by a member of the master |
|---|
| 1492 | | - | 44.26association; |
|---|
| 1493 | | - | 44.27 (vi) the financial arrangements, including any contingencies, which have been made to |
|---|
| 1494 | | - | 44.28provide for completion of the facilities referred to in subsection (v), or a statement that no |
|---|
| 1495 | | - | 44.29arrangements have been made; |
|---|
| 1496 | | - | 44.30 (vii) any current balance sheet of the master association and a projected or current annual |
|---|
| 1497 | | - | 44.31budget, as applicable, which budget shall include with respect to the master association |
|---|
| 1498 | | - | 44.32those items in paragraph (23), clauses (i) through (iii), and the projected monthly or other |
|---|
| 1499 | | - | 44Article 1 Sec. 16. |
|---|
| 1500 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 45.1periodic common expense assessment payment for each type of unit, lot, or other parcel of |
|---|
| 1501 | | - | 45.2real estate which is or is planned to be subject to assessment; |
|---|
| 1502 | | - | 45.3 (viii) a description of any expenses or services not reflected in the budget, paid for or |
|---|
| 1503 | | - | 45.4provided by a master developer or another person executing the master declaration, which |
|---|
| 1504 | | - | 45.5may become an expense of the master association in the future; |
|---|
| 1505 | | - | 45.6 (ix) a description of any powers delegated to and accepted by the master association |
|---|
| 1506 | | - | 45.7pursuant to section 515B.2-121(e)(2); |
|---|
| 1507 | | - | 45.8 (x) identification of any liens, defects, or encumbrances that will continue to affect title |
|---|
| 1508 | | - | 45.9to property owned or operated by the master association for the benefit of its members; |
|---|
| 1509 | | - | 45.10 (xi) the terms of any warranties provided by any person for construction of facilities in |
|---|
| 1510 | | - | 45.11which the members of the master association have or may have an interest, and any known |
|---|
| 1511 | | - | 45.12defects in the facilities which would violate the standards described in section |
|---|
| 1512 | | - | 45.13515B.4-113(b)(2); |
|---|
| 1513 | | - | 45.14 (xii) a statement disclosing, after inquiry of the master association, any unsatisfied |
|---|
| 1514 | | - | 45.15judgments or lawsuits to which the master association is a party, and the status of those |
|---|
| 1515 | | - | 45.16lawsuits which are material to the master association; |
|---|
| 1516 | | - | 45.17 (xiii) a description of any insurance coverage provided for the benefit of its members |
|---|
| 1517 | | - | 45.18by the master association; and |
|---|
| 1518 | | - | 45.19 (xiv) any current or expected fees or charges, other than assessments by the master |
|---|
| 1519 | | - | 45.20association, to be paid by members of the master association for the use of any facilities |
|---|
| 1520 | | - | 45.21intended for the benefit of the members; |
|---|
| 1521 | | - | 45.22 (21) a statement as to whether the unit will be substantially completed at the time of |
|---|
| 1522 | | - | 45.23conveyance to a purchaser, and, if not substantially completed, who is responsible to complete |
|---|
| 1523 | | - | 45.24and pay for the construction of the unit; |
|---|
| 1524 | | - | 45.25 (22) copies of the following documents (which may be in proposed form if the declaration |
|---|
| 1525 | | - | 45.26has not been recorded): the declaration and any supplemental declaration, and any |
|---|
| 1526 | | - | 45.27amendments thereto (exclusive of the CIC plat); any other recorded covenants, conditions, |
|---|
| 1527 | | - | 45.28restrictions, and reservations affecting the common interest community; the articles of |
|---|
| 1528 | | - | 45.29incorporation, bylaws, and any rules or regulations of the association; the names of the |
|---|
| 1529 | | - | 45.30current members of the association's board of directors; any agreement excluding or |
|---|
| 1530 | | - | 45.31modifying any implied warranties; any agreement reducing the statute of limitations for the |
|---|
| 1531 | | - | 45.32enforcement of warranties; any contracts or leases to be signed by the purchaser at closing; |
|---|
| 1532 | | - | 45Article 1 Sec. 16. |
|---|
| 1533 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 46.1and a description of any material contracts, leases, or other agreements affecting the common |
|---|
| 1534 | | - | 46.2interest community; and |
|---|
| 1535 | | - | 46.3 (23) a balance sheet for the association, following the creation of the association, current |
|---|
| 1536 | | - | 46.4within 90 days; a projected annual budget for the association; and a statement identifying |
|---|
| 1537 | | - | 46.5the party responsible for the preparation of the budget. The budget shall assume that all |
|---|
| 1538 | | - | 46.6units intended to be included in the common interest community, based upon the declarant's |
|---|
| 1539 | | - | 46.7good faith estimate, have been subjected to the declaration; provided, that additional budget |
|---|
| 1540 | | - | 46.8portrayals based upon a lesser number of units are permitted. The budget shall include, |
|---|
| 1541 | | - | 46.9without limitation: |
|---|
| 1542 | | - | 46.10 (i) a statement of the amount included in the budget as a reserve for replacement, the |
|---|
| 1543 | | - | 46.11components of the common interest community for which the reserves are budgeted, and |
|---|
| 1544 | | - | 46.12the amounts of the reserves, if any, that are allocated for the replacement of each of those |
|---|
| 1545 | | - | 46.13components; |
|---|
| 1546 | | - | 46.14 (ii) a statement of any other reserves; |
|---|
| 1547 | | - | 46.15 (iii) the projected common expense for each category of expenditures for the association; |
|---|
| 1548 | | - | 46.16 (iv) the projected monthly common expense assessment for each type of unit; |
|---|
| 1549 | | - | 46.17 (v) a statement as to the components of the common interest community whose |
|---|
| 1550 | | - | 46.18replacement will be funded by assessments under section 515B.3-115(c) or (e), rather than |
|---|
| 1551 | | - | 46.19by replacement reserves as approved pursuant to section 515B.3-114(a). If, based upon the |
|---|
| 1552 | | - | 46.20association's then-current budget, the monthly common expense assessment for the unit at |
|---|
| 1553 | | - | 46.21the time of conveyance to the purchaser is anticipated to exceed the monthly assessment |
|---|
| 1554 | | - | 46.22stated in the budget, a statement to such effect shall be included; |
|---|
| 1555 | | - | 46.23 (24) a copy of any fact sheet or other publication by the attorney general and the |
|---|
| 1556 | | - | 46.24Community Association Institute that describes, in plain language, common interest |
|---|
| 1557 | | - | 46.25communities and homeowner associations and explains the rights and responsibilities of |
|---|
| 1558 | | - | 46.26unit owners and associations; and |
|---|
| 1559 | | - | 46.27 (25) the schedules of fines required under section 515B.3-102, subsections (a), paragraph |
|---|
| 1560 | | - | 46.28(10), and (c). |
|---|
| 1561 | | - | 46.29 (b) A declarant shall promptly amend the disclosure statement to reflect any material |
|---|
| 1562 | | - | 46.30change in the information required by this chapter. |
|---|
| 1563 | | - | 46.31 (c) The master association, within ten days after a request by a declarant, a holder of |
|---|
| 1564 | | - | 46.32declarant rights, or a buyer referred to in section 515B.4-101(e), or the authorized |
|---|
| 1565 | | - | 46.33representative of any of them, shall furnish the information required to be provided by |
|---|
| 1566 | | - | 46Article 1 Sec. 16. |
|---|
| 1567 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 47.1subsection (a)(20). A declarant or other person who provides information pursuant to |
|---|
| 1568 | | - | 47.2subsection (a)(20), is not liable to the buyer for any erroneous information if the declarant |
|---|
| 1569 | | - | 47.3or other person: (i) is not an affiliate of or related in any way to a person authorized to |
|---|
| 1570 | | - | 47.4appoint the master association board pursuant to section 515B.2-121(c)(3), and (ii) has no |
|---|
| 1571 | | - | 47.5actual knowledge that the information is incorrect. |
|---|
| 1572 | | - | 47.6 (d) This section applies only to common interest communities created on or after August |
|---|
| 1573 | | - | 47.71, 2010. |
|---|
| 1574 | | - | 47.8 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1575 | | - | 47.9 Sec. 17. Minnesota Statutes 2024, section 515B.4-116, is amended to read: |
|---|
| 1576 | | - | 47.10 515B.4-116 RIGHTS OF ACTION; RETALIATION PROHIBITED; ATTORNEY'S |
|---|
| 1577 | | - | 47.11FEES. |
|---|
| 1578 | | - | 47.12 (a) In addition to any other rights to recover damages, attorney's fees, costs or expenses, |
|---|
| 1579 | | - | 47.13whether authorized by this chapter or otherwise, if a declarant, an association, or any other |
|---|
| 1580 | | - | 47.14person violates any provision of this chapter, or any provision of the declaration, bylaws, |
|---|
| 1581 | | - | 47.15or rules and regulations any person or class of persons adversely affected by the failure to |
|---|
| 1582 | | - | 47.16comply has a claim for appropriate relief. Subject to the requirements of section 515B.3-102, |
|---|
| 1583 | | - | 47.17the association shall have standing to pursue claims on behalf of the unit owners of two or |
|---|
| 1584 | | - | 47.18more units. An association is liable to a unit owner for actual damages and shall pay to the |
|---|
| 1585 | | - | 47.19unit owner a civil penalty in an amount up to $1,000. |
|---|
| 1586 | | - | 47.20 (b) The court may award reasonable attorney's fees and costs of litigation to the prevailing |
|---|
| 1587 | | - | 47.21party. Punitive damages may be awarded for a willful failure to comply. |
|---|
| 1588 | | - | 47.22 (c) As a condition precedent to any construction defect claim, the parties to the claim |
|---|
| 1589 | | - | 47.23must submit the matter to mediation before a mutually agreeable neutral third party. For |
|---|
| 1590 | | - | 47.24the purposes of this section, mediation has the meaning given under the General Rules of |
|---|
| 1591 | | - | 47.25Practice, rule 114.02 (7). If the parties are not able to agree on a neutral third-party mediator |
|---|
| 1592 | | - | 47.26from the roster maintained by the Minnesota Supreme Court, the parties may petition the |
|---|
| 1593 | | - | 47.27district court in the jurisdiction in which the common interest community is located to |
|---|
| 1594 | | - | 47.28appoint a mediator. The applicable statute of limitations and statute of repose for an action |
|---|
| 1595 | | - | 47.29based on breach of a warranty imposed by this section, or any other action in contract, tort, |
|---|
| 1596 | | - | 47.30or other law for any injury to real or personal property or bodily injury or wrongful death |
|---|
| 1597 | | - | 47.31arising out of the alleged construction defect, is tolled from the date that any party makes |
|---|
| 1598 | | - | 47.32a written demand for mediation under this section until the latest of the following: |
|---|
| 1599 | | - | 47.33 (1) five business days after mediation is completed; or |
|---|
| 1600 | | - | 47Article 1 Sec. 17. |
|---|
| 1601 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 48.1 (2) 180 days. |
|---|
| 1602 | | - | 48.2 Notwithstanding the foregoing, mediation shall not be required prior to commencement |
|---|
| 1603 | | - | 48.3of a construction defect claim if the parties have completed home warranty dispute resolution |
|---|
| 1604 | | - | 48.4under section 327A.051. |
|---|
| 1605 | | - | 48.5 (d) The remedies provided for under this chapter are not exclusive and do not abrogate |
|---|
| 1606 | | - | 48.6any remedies under other statutes or the common law, notwithstanding whether those |
|---|
| 1607 | | - | 48.7remedies are referred to in this chapter. |
|---|
| 1608 | | - | 48.8 (e) An association may not retaliate against a unit owner for asserting any right the unit |
|---|
| 1609 | | - | 48.9owner has under this chapter or other law. For purposes of this subsection, "asserting any |
|---|
| 1610 | | - | 48.10rights" includes but is not limited to filing an action in district court to enforce a right or |
|---|
| 1611 | | - | 48.11remedy provided by this chapter, other law, or the declaration, bylaws, rules, or regulations |
|---|
| 1612 | | - | 48.12of the association; or by filing a complaint with local authorities regarding a violation of a |
|---|
| 1613 | | - | 48.13health, safety, housing, or building code or ordinance. An association may not decrease |
|---|
| 1614 | | - | 48.14services or impose a fine or other penalty or charge legal fees to a unit owner, nor may the |
|---|
| 1615 | | - | 48.15association make the resumption of services or removal of the fine, penalty, or legal fees |
|---|
| 1616 | | - | 48.16contingent on a unit owner withdrawing an action in district court or complaint with local |
|---|
| 1617 | | - | 48.17authorities. |
|---|
| 1618 | | - | 48.18 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1619 | | - | 48.19 ARTICLE 2 |
|---|
| 1620 | | - | 48.20 LOCAL GOVERNMENT PREEMPTION |
|---|
| 1621 | | - | 48.21Section 1. Minnesota Statutes 2024, section 394.25, is amended by adding a subdivision |
|---|
| 1622 | | - | 48.22to read: |
|---|
| 1623 | | - | 48.23 Subd. 11.Homeowners associations.(a) A county must not condition approval of a |
|---|
| 1624 | | - | 48.24residential building permit or conditional use permit; residential subdivision development |
|---|
| 1625 | | - | 48.25or residential planned unit development; or any other permit related to residential |
|---|
| 1626 | | - | 48.26development on the: |
|---|
| 1627 | | - | 48.27 (1) creation of a homeowners association; |
|---|
| 1628 | | - | 48.28 (2) inclusion of any service, feature, or common property necessitating a homeowners |
|---|
| 1629 | | - | 48.29association; |
|---|
| 1630 | | - | 48.30 (3) inclusion of any terms in a homeowners association declaration, bylaws, articles of |
|---|
| 1631 | | - | 48.31incorporation, or any other governing document that is not required under state law; or |
|---|
| 1632 | | - | 48Article 2 Section 1. |
|---|
| 1633 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 49.1 (4) adoption or revocation of, or amendment to, a rule or regulation governing the |
|---|
| 1634 | | - | 49.2homeowners association or its members. |
|---|
| 1635 | | - | 49.3 (b) A county must not take any action that requires a residential property to be part of |
|---|
| 1636 | | - | 49.4a homeowners association or provide an incentive for such membership. A county must not |
|---|
| 1637 | | - | 49.5require or incentivize a homeowners association to adopt, revoke, or amend a term in any |
|---|
| 1638 | | - | 49.6governing document or a rule or regulation not required under state law. |
|---|
| 1639 | | - | 49.7 (c) Nothing in this section prohibits a county from ensuring private common areas or |
|---|
| 1640 | | - | 49.8facilities within a development comply with maintenance, insurance, and other requirements |
|---|
| 1641 | | - | 49.9under applicable state law, including under chapter 515, 515A, or 515B. |
|---|
| 1642 | | - | 49.10Sec. 2. [462.3577] MUNICIPALITIES; HOMEOWNERS ASSOCIATIONS. |
|---|
| 1643 | | - | 49.11 (a) A municipality, joint planning board, or public corporation must not condition |
|---|
| 1644 | | - | 49.12approval of a residential building permit or conditional use permit; residential subdivision |
|---|
| 1645 | | - | 49.13development or residential planned unit development; or any other permit related to |
|---|
| 1646 | | - | 49.14residential development on the: |
|---|
| 1647 | | - | 49.15 (1) creation of a homeowners association; |
|---|
| 1648 | | - | 49.16 (2) inclusion of any service, feature, or common property necessitating a homeowners |
|---|
| 1649 | | - | 49.17association; |
|---|
| 1650 | | - | 49.18 (3) inclusion of any terms in a homeowners association declaration, bylaws, articles of |
|---|
| 1651 | | - | 49.19incorporation, or any other governing document that is not required under state law; or |
|---|
| 1652 | | - | 49.20 (4) adoption or revocation of, or amendment to, a rule or regulation governing the |
|---|
| 1653 | | - | 49.21homeowners association or its members. |
|---|
| 1654 | | - | 49.22 (b) A municipality, joint planning board, public corporation, or the Metropolitan Council |
|---|
| 1655 | | - | 49.23must not take any action that requires a residential property to be part of a homeowners |
|---|
| 1656 | | - | 49.24association or provide an incentive for such membership. A municipality, joint planning |
|---|
| 1657 | | - | 49.25board, public corporation, or the Metropolitan Council must not require or incentivize a |
|---|
| 1658 | | - | 49.26homeowners association to adopt, revoke, or amend a term in any governing document or |
|---|
| 1659 | | - | 49.27a rule or regulation not required under state law. |
|---|
| 1660 | | - | 49.28 (c) Nothing in this section prohibits a municipality from ensuring private common areas |
|---|
| 1661 | | - | 49.29or facilities within a development comply with maintenance, insurance, and other |
|---|
| 1662 | | - | 49.30requirements under applicable state law, including under chapter 515, 515A, or 515B. |
|---|
| 1663 | | - | 49Article 2 Sec. 2. |
|---|
| 1664 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT 50.1 Sec. 3. Laws 2024, chapter 96, article 2, section 13, is amended to read: |
|---|
| 1665 | | - | 50.2 Sec. 13. EFFECTIVE DATE. |
|---|
| 1666 | | - | 50.3 This article is effective August 1, 2025 2026. |
|---|
| 1667 | | - | 50.4 Sec. 4. REPEALER. |
|---|
| 1668 | | - | 50.5 Minnesota Statutes 2024, section 308C.003, subdivision 3, is repealed. |
|---|
| 1669 | | - | 50Article 2 Sec. 4. |
|---|
| 1670 | | - | REVISOR MS H1268-1HF1268 FIRST ENGROSSMENT Page.Ln 1.14COMMON INTEREST COMMUNITIES.............................................ARTICLE 1 |
|---|
| 1671 | | - | Page.Ln 48.19LOCAL GOVERNMENT PREEMPTION............................................ARTICLE 2 |
|---|
| 65 | + | REVISOR MS/AD 25-0391902/17/25 3.1 ARTICLE 2 |
|---|
| 66 | + | 3.2 COMMON INTEREST COMMUNITIES |
|---|
| 67 | + | 3.3 Section 1. Minnesota Statutes 2024, section 515B.1-102, is amended to read: |
|---|
| 68 | + | 3.4 515B.1-102 APPLICABILITY. |
|---|
| 69 | + | 3.5 (a) Except as provided in this section, this chapter, and not chapters 515 and 515A, |
|---|
| 70 | + | 3.6applies to all common interest communities created within this state on and after June 1, |
|---|
| 71 | + | 3.71994. |
|---|
| 72 | + | 3.8 (b) The applicability of this chapter to common interest communities created prior to |
|---|
| 73 | + | 3.9June 1, 1994, shall be as follows: |
|---|
| 74 | + | 3.10 (1) This chapter shall apply to condominiums created under chapter 515A with respect |
|---|
| 75 | + | 3.11to events and circumstances occurring on and after June 1, 1994; provided (i) that this |
|---|
| 76 | + | 3.12chapter shall not invalidate the declarations, bylaws or condominium plats of those |
|---|
| 77 | + | 3.13condominiums, and (ii) that chapter 515A, and not this chapter, shall govern all rights and |
|---|
| 78 | + | 3.14obligations of a declarant of a condominium created under chapter 515A, and the rights and |
|---|
| 79 | + | 3.15claims of unit owners against that declarant. |
|---|
| 80 | + | 3.16 (2) The following sections in this chapter apply to condominiums created under chapter |
|---|
| 81 | + | 3.17515: 515B.1-104 (Variation by Agreement); 515B.1-105 (Separate Titles and Taxation); |
|---|
| 82 | + | 3.18515B.1-106 (Applicability of Local Requirements); 515B.1-107 (Eminent Domain); |
|---|
| 83 | + | 3.19515B.1-108 (This Chapter Prevails; Supplemental Law); 515B.1-109 (Construction Against |
|---|
| 84 | + | 3.20Implicit Repeal); 515B.1-112 (Unconscionable Agreement or Term of Contract); 515B.1-113 |
|---|
| 85 | + | 3.21(Obligation of Good Faith); 515B.1-114 (Remedies to be Liberally Administered); |
|---|
| 86 | + | 3.22515B.1-115 (Notice); 515B.1-116 (Recording); 515B.2-103 (Construction and Validity of |
|---|
| 87 | + | 3.23Declaration and Bylaws); 515B.2-104 (Description of Units); 515B.2-108(d) (Allocation |
|---|
| 88 | + | 3.24of Interests); 515B.2-109(f) (Common Elements and Limited Common Elements); |
|---|
| 89 | + | 3.25515B.2-112 (Subdivision, Combination, or Conversion of Units); 515B.2-113 (Alteration |
|---|
| 90 | + | 3.26of Units); 515B.2-114 (Relocation of Boundaries Between Adjoining Units); 515B.2-115 |
|---|
| 91 | + | 3.27(Minor Variations in Boundaries); 515B.2-118 (Amendment of Declaration); 515B.2-119 |
|---|
| 92 | + | 3.28(Termination of Common Interest Community); 515B.3-102 (Powers of Unit Owners' |
|---|
| 93 | + | 3.29Association); 515B.3-103(a), (b), and (g) (Board of Directors, Officers, and Declarant |
|---|
| 94 | + | 3.30Control); 515B.3-107 (Upkeep of Common Interest Community); 515B.3-108 (Meetings); |
|---|
| 95 | + | 3.31515B.3-109 (Quorums); 515B.3-110 (Voting; Proxies); 515B.3-111 (Tort and Contract |
|---|
| 96 | + | 3.32Liability); 515B.3-112 (Conveyance of, or Creation of Security Interests in, Common |
|---|
| 97 | + | 3.33Elements); 515B.3-113 (Insurance); 515B.3-114 (Replacement Reserves); 515B.3-115(c), |
|---|
| 98 | + | 3.34(e), (f), (g), (h), and (i) (Assessments for Common Expenses); 515B.3-116 (Lien for |
|---|
| 99 | + | 3Article 2 Section 1. |
|---|
| 100 | + | REVISOR MS/AD 25-0391902/17/25 4.1Assessments); 515B.3-117 (Other Liens); 515B.3-118 (Association Records); 515B.3-119 |
|---|
| 101 | + | 4.2(Association as Trustee); 515B.3-121 (Accounting Controls); 515B.4-107 (Resale of Units); |
|---|
| 102 | + | 4.3515B.4-108 (Purchaser's Right to Cancel Resale); and 515B.4-116 (Rights of Action; |
|---|
| 103 | + | 4.4Attorney's Fees). Section 515B.1-103 (Definitions) shall apply to the extent necessary in |
|---|
| 104 | + | 4.5construing any of the sections referenced in this section. Sections 515B.1-105, 515B.1-106, |
|---|
| 105 | + | 4.6515B.1-107, 515B.1-116, 515B.2-103, 515B.2-104, 515B.2-118, 515B.3-102, 515B.3-110, |
|---|
| 106 | + | 4.7515B.3-111, 515B.3-113, 515B.3-116, 515B.3-117, 515B.3-118, 515B.3-121, 515B.4-107, |
|---|
| 107 | + | 4.8515B.4-108, and 515B.4-116 apply only with respect to events and circumstances occurring |
|---|
| 108 | + | 4.9on and after June 1, 1994. All other sections referenced in this section apply only with |
|---|
| 109 | + | 4.10respect to events and circumstances occurring after July 31, 1999. A section referenced in |
|---|
| 110 | + | 4.11this section does not invalidate the declarations, bylaws or condominium plats of |
|---|
| 111 | + | 4.12condominiums created before August 1, 1999. But all sections referenced in this section |
|---|
| 112 | + | 4.13prevail over the declarations, bylaws, CIC plats, rules and regulations under them, of |
|---|
| 113 | + | 4.14condominiums created before August 1, 1999, except to the extent that this chapter defers |
|---|
| 114 | + | 4.15to the declarations, bylaws, CIC plats, or rules and regulations issued under them. |
|---|
| 115 | + | 4.16 (3) This chapter shall not apply to cooperatives and planned communities created prior |
|---|
| 116 | + | 4.17to June 1, 1994, or to planned communities that were created on or after June 1, 1994, and |
|---|
| 117 | + | 4.18before August 1, 2006, and that consist of more than two but fewer than 13 units; except |
|---|
| 118 | + | 4.19by election pursuant to subsection (d), and except that the following sections apply to all |
|---|
| 119 | + | 4.20planned communities, townhome associations, and cooperatives regardless of when created, |
|---|
| 120 | + | 4.21unless they are exempt under subsection (e): sections 515B.1-116, subsections (a), (c), (d), |
|---|
| 121 | + | 4.22and (e),; 515B.3-102, subsections (a), paragraphs (1), (3), (11), and (12), (c), and (g); |
|---|
| 122 | + | 4.23515B.3-103, subsections (a), (e), paragraph (4), (g), and (h); 515B.3-107, subsections (a), |
|---|
| 123 | + | 4.24(d), (e), (f), and (g); 515B.3-115, subsections (e), paragraphs (4) and (5), (g), and (k); |
|---|
| 124 | + | 4.25515.3-1151, subsections (e), paragraphs (4) and (5), (g), and (k); 515.3-116, subsections |
|---|
| 125 | + | 4.26(a) and (h); 515.3-122; 515B.4-107,; and 515B.4-108, apply to all planned communities |
|---|
| 126 | + | 4.27and cooperatives regardless of when they are created, unless they are exempt under subsection |
|---|
| 127 | + | 4.28(e). |
|---|
| 128 | + | 4.29 (c) This chapter shall not invalidate any amendment to the declaration, bylaws or |
|---|
| 129 | + | 4.30condominium plat of any condominium created under chapter 515 or 515A if the amendment |
|---|
| 130 | + | 4.31was recorded before June 1, 1994. Any amendment recorded on or after June 1, 1994, shall |
|---|
| 131 | + | 4.32be adopted in conformity with the procedures and requirements specified by those instruments |
|---|
| 132 | + | 4.33and by this chapter. If the amendment grants to any person any rights, powers or privileges |
|---|
| 133 | + | 4.34permitted by this chapter, all correlative obligations, liabilities and restrictions contained |
|---|
| 134 | + | 4.35in this chapter shall also apply to that person. |
|---|
| 135 | + | 4Article 2 Section 1. |
|---|
| 136 | + | REVISOR MS/AD 25-0391902/17/25 5.1 (d) Any condominium created under chapter 515, any planned community or cooperative |
|---|
| 137 | + | 5.2which would be exempt from this chapter under subsection (e), or any planned community |
|---|
| 138 | + | 5.3or cooperative created prior to June 1, 1994, or any planned community that was created |
|---|
| 139 | + | 5.4on or after June 1, 1994, and prior to August 1, 2006, and that consists of more than two |
|---|
| 140 | + | 5.5but fewer than 13 units, may elect to be subject to this chapter, as follows: |
|---|
| 141 | + | 5.6 (1) The election shall be accomplished by recording a declaration or amended declaration, |
|---|
| 142 | + | 5.7and a new or amended CIC plat where required, and by approving bylaws or amended |
|---|
| 143 | + | 5.8bylaws, which conform to the requirements of this chapter, and which, in the case of |
|---|
| 144 | + | 5.9amendments, are adopted in conformity with the procedures and requirements specified by |
|---|
| 145 | + | 5.10the existing declaration and bylaws of the common interest community, and by any applicable |
|---|
| 146 | + | 5.11statutes. |
|---|
| 147 | + | 5.12 (2) In a condominium, the preexisting condominium plat shall be the CIC plat and an |
|---|
| 148 | + | 5.13amended CIC plat shall be required only if the amended declaration or bylaws contain |
|---|
| 149 | + | 5.14provisions inconsistent with the preexisting condominium plat. The condominium's CIC |
|---|
| 150 | + | 5.15number shall be the apartment ownership number or condominium number originally |
|---|
| 151 | + | 5.16assigned to it by the recording officer. In a cooperative in which the unit owners' interests |
|---|
| 152 | + | 5.17are characterized as real estate, a CIC plat shall be required. In a planned community, the |
|---|
| 153 | + | 5.18preexisting plat or registered land survey recorded pursuant to chapter 505, 508, or 508A, |
|---|
| 154 | + | 5.19or the part of the plat or registered land survey upon which the common interest community |
|---|
| 155 | + | 5.20is located, shall be the CIC plat. |
|---|
| 156 | + | 5.21 (3) The amendment shall comply with section 515B.2-118(a)(3) and (c); except that the |
|---|
| 157 | + | 5.22unanimous consent of the unit owners shall not be required for (i) a clarification of the unit |
|---|
| 158 | + | 5.23boundary description if the clarified boundary description is substantially consistent with |
|---|
| 159 | + | 5.24the preexisting CIC plat, or (ii) changes from common elements to limited common elements |
|---|
| 160 | + | 5.25that occur by operation of section 515B.2-109(c) and (d). |
|---|
| 161 | + | 5.26 (4) Except as permitted by paragraph (3), no declarant, affiliate of declarant, association, |
|---|
| 162 | + | 5.27master association nor unit owner may acquire, increase, waive, reduce or revoke any |
|---|
| 163 | + | 5.28previously existing warranty rights or causes of action that one of said persons has against |
|---|
| 164 | + | 5.29any other of said persons by reason of exercising the right of election under this subsection. |
|---|
| 165 | + | 5.30 (5) A common interest community which elects to be subject to this chapter may, as a |
|---|
| 166 | + | 5.31part of the election process, change its form of ownership by complying with section |
|---|
| 167 | + | 5.32515B.2-123. |
|---|
| 168 | + | 5.33 (e) Except as otherwise provided in this subsection, this chapter shall not apply, except |
|---|
| 169 | + | 5.34by election pursuant to subsection (d), to the following: |
|---|
| 170 | + | 5Article 2 Section 1. |
|---|
| 171 | + | REVISOR MS/AD 25-0391902/17/25 6.1 (1) a planned community which consists of two units, which utilizes a CIC plat complying |
|---|
| 172 | + | 6.2with section 515B.2-110(d)(1) and (2), or section 515B.2-1101(d)(1) and (2), which is not |
|---|
| 173 | + | 6.3subject to any rights to subdivide or convert units or to add additional real estate, and which |
|---|
| 174 | + | 6.4is not subject to a master association; |
|---|
| 175 | + | 6.5 (2) a common interest community that consists solely of platted lots or other separate |
|---|
| 176 | + | 6.6parcels of real estate designed or utilized for detached single family dwellings or agricultural |
|---|
| 177 | + | 6.7purposes, with or without common property, where no association or master association |
|---|
| 178 | + | 6.8has an obligation to maintain any building containing a dwelling or any agricultural building |
|---|
| 179 | + | 6.9located or to be located on such platted lots or parcels; except that section 515B.4-101(e) |
|---|
| 180 | + | 6.10shall apply to the sale of such platted lots or parcels of real estate if the common interest |
|---|
| 181 | + | 6.11community is or will be subject to a master declaration; |
|---|
| 182 | + | 6.12 (3) a cooperative where, at the time of creation of the cooperative, the unit owners' |
|---|
| 183 | + | 6.13interests in the dwellings as described in the declaration consist solely of proprietary leases |
|---|
| 184 | + | 6.14having an unexpired term of fewer than 20 years, including renewal options; |
|---|
| 185 | + | 6.15 (4) planned communities utilizing a CIC plat complying with section 515B.2-110(d)(1) |
|---|
| 186 | + | 6.16and (2), or section 515B.2-1101(d)(1) and (2), and cooperatives, which are limited by the |
|---|
| 187 | + | 6.17declaration to nonresidential uses; or |
|---|
| 188 | + | 6.18 (5) real estate subject only to an instrument or instruments filed primarily for the purpose |
|---|
| 189 | + | 6.19of creating or modifying rights with respect to access, utilities, parking, ditches, drainage, |
|---|
| 190 | + | 6.20or irrigation. |
|---|
| 191 | + | 6.21 (f) Section 515B.4-101(e) applies to any platted lot or other parcel of real estate that is |
|---|
| 192 | + | 6.22subject to a master declaration and is not subject to or is exempt from this chapter. |
|---|
| 193 | + | 6.23 (g) Section 515B.1-106 and section 515B.2-118, subsections (a)(5), (a)(7), and (d), shall |
|---|
| 194 | + | 6.24apply to all common interest communities. |
|---|
| 195 | + | 6.25 (h) Sections 515B.1-103(33a), 515B.2-110, 515B.3-105, 515B.3-115, 515B.4-102, and |
|---|
| 196 | + | 6.26515B.4-115 apply only to common interest communities created before August 1, 2010. |
|---|
| 197 | + | 6.27Sections 515B.1-103(33b), 515B.2-1101, 515B.3-1051, 515B.3-1151, 515B.4-1021, and |
|---|
| 198 | + | 6.28515B.4-1151 apply only to common interest communities created on or after August 1, |
|---|
| 199 | + | 6.292010. |
|---|
| 200 | + | 6.30 (i) Section 515B.3-114 applies to common interest communities only for the association's |
|---|
| 201 | + | 6.31fiscal years commencing before January 1, 2012. Section 515B.3-1141 applies to common |
|---|
| 202 | + | 6.32interest communities only for the association's fiscal years commencing on or after January |
|---|
| 203 | + | 6.331, 2012. |
|---|
| 204 | + | 6Article 2 Section 1. |
|---|
| 205 | + | REVISOR MS/AD 25-0391902/17/25 7.1 (j) Section 515B.3-104 applies only to transfers of special declarant rights that are |
|---|
| 206 | + | 7.2effective before August 1, 2010. Section 515B.3-1041, subsections (a) through (i), apply |
|---|
| 207 | + | 7.3only to transfers of special declarant rights that are effective on or after August 1, 2010. |
|---|
| 208 | + | 7.4Section 515B.3-1041, subsections (j) and (k), apply only to special declarant rights reserved |
|---|
| 209 | + | 7.5in a declaration that is first recorded on or after August 1, 2010. |
|---|
| 210 | + | 7.6 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 211 | + | 7.7 Sec. 2. Minnesota Statutes 2024, section 515B.2-103, is amended to read: |
|---|
| 212 | + | 7.8 515B.2-103 CONSTRUCTION AND VALIDITY OF DECLARATION AND |
|---|
| 213 | + | 7.9BYLAWS. |
|---|
| 214 | + | 7.10 (a) All provisions of the declaration and bylaws are severable. |
|---|
| 215 | + | 7.11 (b) The rule against perpetuities may not be applied to defeat any provision of the |
|---|
| 216 | + | 7.12declaration or this chapter, or any instrument executed pursuant to the declaration or this |
|---|
| 217 | + | 7.13chapter. |
|---|
| 218 | + | 7.14 (c) In the event of a conflict between the provisions of the declaration and the bylaws, |
|---|
| 219 | + | 7.15the declaration prevails except to the extent that the declaration is inconsistent with this |
|---|
| 220 | + | 7.16chapter. In the event of a conflict between the provisions of the declaration or the bylaws |
|---|
| 221 | + | 7.17and this chapter, this chapter prevails. |
|---|
| 222 | + | 7.18 (d) The declaration and bylaws must comply with sections 500.215, 500.216, and 500.217. |
|---|
| 223 | + | 7.19 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 224 | + | 7.20 Sec. 3. Minnesota Statutes 2024, section 515B.2-119, is amended to read: |
|---|
| 225 | + | 7.21 515B.2-119 TERMINATION OF COMMON INTEREST COMMUNITY . |
|---|
| 226 | + | 7.22 (a) Except as otherwise provided in this chapter, a common interest community may be |
|---|
| 227 | + | 7.23terminated as follows: |
|---|
| 228 | + | 7.24 (1) if the common interest community does not own any common elements, the common |
|---|
| 229 | + | 7.25interest community may be terminated only by agreement of unit owners of units to which |
|---|
| 230 | + | 7.26at least 60 percent of the votes in the association are allocated; or |
|---|
| 231 | + | 7.27 (2) if the common interest community owns common elements, the common interest |
|---|
| 232 | + | 7.28community may be terminated only by agreement of unit owners of units to which at least |
|---|
| 233 | + | 7.2980 percent of the votes in the association are allocated, and 80 percent of the first mortgagees |
|---|
| 234 | + | 7.30of units (each mortgagee having one vote per unit financed), or any larger percentage the |
|---|
| 235 | + | 7Article 2 Sec. 3. |
|---|
| 236 | + | REVISOR MS/AD 25-0391902/17/25 8.1declaration specifies. The declaration may specify a smaller percentage only if all of the |
|---|
| 237 | + | 8.2units are single-family homes or if all of the units are restricted to nonresidential use. |
|---|
| 238 | + | 8.3 (b) An agreement to terminate shall be evidenced by a written agreement, executed in |
|---|
| 239 | + | 8.4the same manner as a deed by the number of unit owners and first mortgagees of units |
|---|
| 240 | + | 8.5required by subsection (a). The agreement shall specify a date after which the agreement |
|---|
| 241 | + | 8.6shall be void unless recorded before that date. The agreement shall also specify a date by |
|---|
| 242 | + | 8.7which the termination of the common interest community and the winding up of its affairs |
|---|
| 243 | + | 8.8must be accomplished. A certificate of termination executed by the association evidencing |
|---|
| 244 | + | 8.9the termination shall be recorded on or before the termination date, or the agreement to |
|---|
| 245 | + | 8.10terminate shall be revoked. The agreement to terminate, or a memorandum thereof, and the |
|---|
| 246 | + | 8.11certificate of termination shall be recorded in every county in which a portion of the common |
|---|
| 247 | + | 8.12interest community is situated and is effective only upon recording. |
|---|
| 248 | + | 8.13 (c) In the case of a condominium or planned community containing only units having |
|---|
| 249 | + | 8.14upper and lower boundaries, a termination agreement may provide that all of the common |
|---|
| 250 | + | 8.15elements and units of the common interest community must be sold following termination. |
|---|
| 251 | + | 8.16If, pursuant to the agreement, any real estate in the common interest community is to be |
|---|
| 252 | + | 8.17sold following termination, the termination agreement shall set forth the minimum terms |
|---|
| 253 | + | 8.18of sale acceptable to the association. |
|---|
| 254 | + | 8.19 (d) In the case of a condominium or planned community containing any units not having |
|---|
| 255 | + | 8.20upper and lower boundaries, a termination agreement may provide for sale of the common |
|---|
| 256 | + | 8.21elements, but it may not require that the units be sold following termination, unless the |
|---|
| 257 | + | 8.22original declaration provided otherwise or all unit owners whose units are to be sold consent |
|---|
| 258 | + | 8.23to the sale. |
|---|
| 259 | + | 8.24 (e) The association, on behalf of the unit owners, shall have authority to contract for the |
|---|
| 260 | + | 8.25sale of real estate in a common interest community pursuant to this section, subject to the |
|---|
| 261 | + | 8.26required approval. The agreement to terminate shall be deemed to grant to the association |
|---|
| 262 | + | 8.27a power of attorney coupled with an interest to effect the conveyance of the real estate on |
|---|
| 263 | + | 8.28behalf of the holders of all interests in the units, including without limitation the power to |
|---|
| 264 | + | 8.29execute all instruments of conveyance and related instruments. Until the sale has been |
|---|
| 265 | + | 8.30completed, all instruments in connection with the sale have been executed and the sale |
|---|
| 266 | + | 8.31proceeds distributed, the association shall continue in existence with all powers it had before |
|---|
| 267 | + | 8.32termination. |
|---|
| 268 | + | 8.33 (1) The instrument conveying or creating the interest in the common interest community |
|---|
| 269 | + | 8.34shall include as exhibits (i) an affidavit of the secretary of the association certifying that the |
|---|
| 270 | + | 8Article 2 Sec. 3. |
|---|
| 271 | + | REVISOR MS/AD 25-0391902/17/25 9.1approval required by this section has been obtained and (ii) a schedule of the names of all |
|---|
| 272 | + | 9.2unit owners in the common interest community as of the date of the approval. |
|---|
| 273 | + | 9.3 (2) Proceeds of the sale shall be distributed to unit owners and secured parties as their |
|---|
| 274 | + | 9.4interests may appear, in accordance with subsections (h), (i), (j), and (k). |
|---|
| 275 | + | 9.5 (3) Unless otherwise specified in the agreement of termination, until the association has |
|---|
| 276 | + | 9.6conveyed title to the real estate, each unit owner and the unit owner's successors in interest |
|---|
| 277 | + | 9.7have an exclusive right to occupancy of the portion of the real estate that formerly constituted |
|---|
| 278 | + | 9.8the unit. During the period of that occupancy, each unit owner and the unit owner's successors |
|---|
| 279 | + | 9.9in interest remain liable for all assessments and other obligations imposed on unit owners |
|---|
| 280 | + | 9.10by this chapter, the declaration or the bylaws. |
|---|
| 281 | + | 9.11 (f) The legal description of the real estate constituting the common interest community |
|---|
| 282 | + | 9.12shall, upon the date of recording of the certificate of termination referred to in subsection |
|---|
| 283 | + | 9.13(b), be as follows: |
|---|
| 284 | + | 9.14 (1) In a planned community utilizing a CIC plat complying with section 515B.2-110(d)(1) |
|---|
| 285 | + | 9.15and (2), the lot and block description contained in the CIC plat, and any amendments thereto, |
|---|
| 286 | + | 9.16subject to any subsequent conveyance or taking of a fee interest in any part of the property. |
|---|
| 287 | + | 9.17 (2) In a condominium or cooperative, or a planned community utilizing a CIC plat |
|---|
| 288 | + | 9.18complying with section 515B.2-110(c), the underlying legal description of the real estate |
|---|
| 289 | + | 9.19as set forth in the declaration creating the common interest community, and any amendments |
|---|
| 290 | + | 9.20thereto, subject to any subsequent conveyance or taking of a fee interest in any part of the |
|---|
| 291 | + | 9.21property. |
|---|
| 292 | + | 9.22 (3) The legal description referred to in this subsection shall apply upon the recording of |
|---|
| 293 | + | 9.23the certificate of termination. The recording officer for each county in which the common |
|---|
| 294 | + | 9.24interest community is located shall index the property located in that county in its records |
|---|
| 295 | + | 9.25under the legal description required by this subsection from and after the date of recording |
|---|
| 296 | + | 9.26of the certificate of termination. In the case of registered property, the registrar of titles shall |
|---|
| 297 | + | 9.27cancel the existing certificates of title with respect to the property and issue one or more |
|---|
| 298 | + | 9.28certificates of title for the property utilizing the legal description required by this subsection. |
|---|
| 299 | + | 9.29 (g) In a condominium or planned community, if the agreement to terminate provides |
|---|
| 300 | + | 9.30that the real estate constituting the common interest community is not to be sold following |
|---|
| 301 | + | 9.31termination, title to the common elements and, in a common interest community containing |
|---|
| 302 | + | 9.32only units having upper and lower boundaries described in the declaration, title to all the |
|---|
| 303 | + | 9.33real estate in the common interest community, vests in the unit owners upon termination as |
|---|
| 304 | + | 9.34tenants in common in proportion to their respective interest as provided in subsection (k), |
|---|
| 305 | + | 9Article 2 Sec. 3. |
|---|
| 306 | + | REVISOR MS/AD 25-0391902/17/25 10.1and liens on the units shift accordingly. While the tenancy in common exists, each unit |
|---|
| 307 | + | 10.2owner and the unit owner's successors in interest have an exclusive right to occupancy of |
|---|
| 308 | + | 10.3the portion of the real estate that formerly constituted the unit. |
|---|
| 309 | + | 10.4 (h) The proceeds of any sale of real estate pursuant to subsection (e), together with the |
|---|
| 310 | + | 10.5assets of the association, shall be held by the association as trustee for unit owners, secured |
|---|
| 311 | + | 10.6parties and other holders of liens on the units as their interests may appear. Before distributing |
|---|
| 312 | + | 10.7any proceeds, the association shall have authority to deduct from the proceeds of sale due |
|---|
| 313 | + | 10.8with respect to the unit (i) unpaid assessments levied by the association with respect to the |
|---|
| 314 | + | 10.9unit, (ii) unpaid real estate taxes or special assessments due with respect to the unit, and |
|---|
| 315 | + | 10.10(iii) the share of expenses of sale and winding up of the association's affairs with respect to |
|---|
| 316 | + | 10.11the unit. |
|---|
| 317 | + | 10.12 (i) Following termination of a condominium or planned community, creditors of the |
|---|
| 318 | + | 10.13association holding liens on the units perfected before termination may enforce those liens |
|---|
| 319 | + | 10.14in the same manner as any lienholder, in order of priority based upon their times of perfection. |
|---|
| 320 | + | 10.15All other creditors of the association are to be treated as if they had perfected liens on the |
|---|
| 321 | + | 10.16units immediately before termination. |
|---|
| 322 | + | 10.17 (j) In a cooperative, the declaration may provide that all creditors of the association have |
|---|
| 323 | + | 10.18priority over any interests of unit owners and creditors of unit owners. In that event, following |
|---|
| 324 | + | 10.19termination, creditors of the association holding liens on the cooperative which were perfected |
|---|
| 325 | + | 10.20before termination may enforce their liens in the same manner as any lienholder, in order |
|---|
| 326 | + | 10.21of priority based upon their times of perfection. All other creditors of the association shall |
|---|
| 327 | + | 10.22be treated as if they had perfected a lien against the cooperative immediately before |
|---|
| 328 | + | 10.23termination. Unless the declaration provides that all creditors of the association have that |
|---|
| 329 | + | 10.24priority: |
|---|
| 330 | + | 10.25 (1) the lien of each creditor of the association which was perfected against the association |
|---|
| 331 | + | 10.26before termination becomes, upon termination, a lien against each unit owner's interest in |
|---|
| 332 | + | 10.27the unit as of the date the lien was perfected; |
|---|
| 333 | + | 10.28 (2) any other creditor of the association is to be treated upon termination as if the creditor |
|---|
| 334 | + | 10.29had perfected a lien against each unit owner's interest immediately before termination; |
|---|
| 335 | + | 10.30 (3) the amount of the lien of an association's creditor described in paragraphs (1) and |
|---|
| 336 | + | 10.31(2) against each of the unit owners' interest shall be proportionate to the ratio which each |
|---|
| 337 | + | 10.32unit's common expense liability bears to the common expense liability of all of the units; |
|---|
| 338 | + | 10Article 2 Sec. 3. |
|---|
| 339 | + | REVISOR MS/AD 25-0391902/17/25 11.1 (4) the lien of each creditor of each unit owner which was perfected before termination |
|---|
| 340 | + | 11.2continues as a lien against that unit owner's interest in the unit as of the date the lien was |
|---|
| 341 | + | 11.3perfected; and |
|---|
| 342 | + | 11.4 (5) the assets of the association shall be distributed to all unit owners and all lienholders |
|---|
| 343 | + | 11.5as their interests may appear in the order described in this section. Creditors of the association |
|---|
| 344 | + | 11.6are not entitled to payment from any unit owner in excess of the amount of the creditor's |
|---|
| 345 | + | 11.7lien against that unit owner's interest. |
|---|
| 346 | + | 11.8 (k) The respective interest of unit owners referred to in subsections (e), (f), (g), (h) and |
|---|
| 347 | + | 11.9(i) are as follows: |
|---|
| 348 | + | 11.10 (1) Except as provided in paragraph (2), the respective interests of unit owners are the |
|---|
| 349 | + | 11.11fair market values of their units, allocated interests, and any limited common elements |
|---|
| 350 | + | 11.12immediately before the termination, as determined by one or more independent appraisers |
|---|
| 351 | + | 11.13selected by the association. The decision of the independent appraisers must be distributed |
|---|
| 352 | + | 11.14to the unit owners and becomes final unless disapproved within 30 days after distribution |
|---|
| 353 | + | 11.15by unit owners of units to which 25 percent of the votes in the association are allocated. |
|---|
| 354 | + | 11.16The proportion of any unit's interest to that of all units is determined by dividing the fair |
|---|
| 355 | + | 11.17market value of that unit by the total fair market values of all the units. |
|---|
| 356 | + | 11.18 (2) If any unit or any limited common element is destroyed to the extent that an appraisal |
|---|
| 357 | + | 11.19of the fair market value thereof before destruction cannot be made, the interests of all unit |
|---|
| 358 | + | 11.20owners shall be measured by: (i) in a condominium, their allocations of common element |
|---|
| 359 | + | 11.21interests immediately before the termination, (ii) in a cooperative, their respective ownership |
|---|
| 360 | + | 11.22interests immediately before the termination, and (iii) in a planned community, their |
|---|
| 361 | + | 11.23respective allocations of common expenses immediately before the termination. |
|---|
| 362 | + | 11.24 (l) In a condominium or planned community, except as provided in subsection (m), |
|---|
| 363 | + | 11.25foreclosure or enforcement of a lien or encumbrance against the entire common interest |
|---|
| 364 | + | 11.26community does not terminate, of itself, the common interest community, and foreclosure |
|---|
| 365 | + | 11.27or enforcement of a lien or encumbrance against a portion of the common interest community |
|---|
| 366 | + | 11.28does not withdraw that portion from the common interest community. |
|---|
| 367 | + | 11.29 (m) In a condominium or planned community, if a lien or encumbrance against a portion |
|---|
| 368 | + | 11.30of the real estate comprising the common interest community has priority over the declaration |
|---|
| 369 | + | 11.31and the lien or encumbrance has not been partially released, the parties foreclosing the lien |
|---|
| 370 | + | 11.32or encumbrance, upon foreclosure, may record an instrument excluding the real estate subject |
|---|
| 371 | + | 11.33to that lien or encumbrance from the common interest community. |
|---|
| 372 | + | 11Article 2 Sec. 3. |
|---|
| 373 | + | REVISOR MS/AD 25-0391902/17/25 12.1 (n) Following the termination of a common interest community in accordance with this |
|---|
| 374 | + | 12.2section, the association shall be dissolved in accordance with law. |
|---|
| 375 | + | 12.3 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 376 | + | 12.4 Sec. 4. Minnesota Statutes 2024, section 515B.3-102, is amended to read: |
|---|
| 377 | + | 12.5 515B.3-102 POWERS AND DUTIES OF UNIT OWNERS' ASSOCIATION. |
|---|
| 378 | + | 12.6 (a) Except as provided in subsections (b), (c), (d), (e), and (f) and subject to the provisions |
|---|
| 379 | + | 12.7of the declaration or bylaws, the association shall have the power to: |
|---|
| 380 | + | 12.8 (1) adopt, amend and revoke rules and regulations not inconsistent with the articles of |
|---|
| 381 | + | 12.9incorporation, bylaws and declaration, and consistent with the requirements of subsection |
|---|
| 382 | + | 12.10(g) as follows: (i) regulating the use of the common elements; (ii) regulating the use of the |
|---|
| 383 | + | 12.11units, and conduct of unit occupants, which may jeopardize the health, safety or welfare of |
|---|
| 384 | + | 12.12other occupants, which involves noise or other disturbing activity, or which may damage |
|---|
| 385 | + | 12.13the common elements or other units; (iii) regulating or prohibiting animals; (iv) regulating |
|---|
| 386 | + | 12.14changes in the appearance of the common elements and conduct which may damage the |
|---|
| 387 | + | 12.15common interest community; (v) regulating the exterior appearance of the common interest |
|---|
| 388 | + | 12.16community, including, for example, balconies and patios, window treatments, and signs |
|---|
| 389 | + | 12.17and other displays, regardless of whether inside a unit; (vi) implementing the articles of |
|---|
| 390 | + | 12.18incorporation, declaration and bylaws, and exercising the powers granted by this section; |
|---|
| 391 | + | 12.19and (vii) otherwise facilitating the operation of the common interest community. The |
|---|
| 392 | + | 12.20association must prepare a plain-language explanation of the current declaration and articles |
|---|
| 393 | + | 12.21of incorporation for unit owners; |
|---|
| 394 | + | 12.22 (2) adopt and amend budgets for revenues, expenditures and reserves, and levy and |
|---|
| 395 | + | 12.23collect assessments for common expenses from unit owners; |
|---|
| 396 | + | 12.24 (3) hire and discharge managing agents and other employees, agents, and independent |
|---|
| 397 | + | 12.25contractors; |
|---|
| 398 | + | 12.26 (4) institute, defend, or intervene in litigation or administrative proceedings (i) in its |
|---|
| 399 | + | 12.27own name on behalf of itself or two or more unit owners on matters affecting the common |
|---|
| 400 | + | 12.28elements or other matters affecting the common interest community or, (ii) with the consent |
|---|
| 401 | + | 12.29of the owners of the affected units on matters affecting only those units; |
|---|
| 402 | + | 12.30 (5) make contracts and incur liabilities; |
|---|
| 403 | + | 12.31 (6) regulate the use, maintenance, repair, replacement, and modification of the common |
|---|
| 404 | + | 12.32elements and the units; |
|---|
| 405 | + | 12Article 2 Sec. 4. |
|---|
| 406 | + | REVISOR MS/AD 25-0391902/17/25 13.1 (7) cause improvements to be made as a part of the common elements, and, in the case |
|---|
| 407 | + | 13.2of a cooperative, the units; |
|---|
| 408 | + | 13.3 (8) acquire, hold, encumber, and convey in its own name any right, title, or interest to |
|---|
| 409 | + | 13.4real estate or personal property, but (i) common elements in a condominium or planned |
|---|
| 410 | + | 13.5community may be conveyed or subjected to a security interest only pursuant to section |
|---|
| 411 | + | 13.6515B.3-112, or (ii) part of a cooperative may be conveyed, or all or part of a cooperative |
|---|
| 412 | + | 13.7may be subjected to a security interest, only pursuant to section 515B.3-112; |
|---|
| 413 | + | 13.8 (9) grant or amend easements for public utilities, public rights-of-way or other public |
|---|
| 414 | + | 13.9purposes, and cable television or other communications, through, over or under the common |
|---|
| 415 | + | 13.10elements; grant or amend easements, leases, or licenses to unit owners for purposes authorized |
|---|
| 416 | + | 13.11by the declaration; and, subject to approval by a vote of unit owners other than declarant |
|---|
| 417 | + | 13.12or its affiliates, grant or amend other easements, leases, and licenses through, over or under |
|---|
| 418 | + | 13.13the common elements; |
|---|
| 419 | + | 13.14 (10) impose and receive any payments, fees, or charges for the use, rental, or operation |
|---|
| 420 | + | 13.15of the common elements, other than limited common elements, and for services provided |
|---|
| 421 | + | 13.16to unit owners. The association must compile and provide to every unit owner a schedule |
|---|
| 422 | + | 13.17of the fees and charges that may be imposed; |
|---|
| 423 | + | 13.18 (11) impose interest and a late charges fee for late payment of assessments, provided |
|---|
| 424 | + | 13.19that an association may not impose a late fee in excess of $15; may not impose, for a special |
|---|
| 425 | + | 13.20assessment, an amount greater than five percent of the amount owed or more than $100, |
|---|
| 426 | + | 13.21whichever is lower; and, after notice and an opportunity to be heard before the board or a |
|---|
| 427 | + | 13.22committee appointed by it, levy reasonable fines for violations of the declaration, bylaws, |
|---|
| 428 | + | 13.23and rules and regulations of the association as specified in subsection (c), provided that |
|---|
| 429 | + | 13.24attorney fees and costs must not be charged or collected from a unit owner who disputes or |
|---|
| 430 | + | 13.25questions a fine or assessment and, if after the homeowner requests a hearing and a hearing |
|---|
| 431 | + | 13.26is held by the board or a committee of the board, the board does not adopt a resolution |
|---|
| 432 | + | 13.27levying the fine or upholding the assessment against the unit owner or owner's unit; |
|---|
| 433 | + | 13.28 (12) impose reasonable charges for the review, preparation and recordation of |
|---|
| 434 | + | 13.29amendments to the declaration, or resale certificates required by section 515B.4-107, |
|---|
| 435 | + | 13.30statements of unpaid assessments, or furnishing copies of association records provided that |
|---|
| 436 | + | 13.31the association may not impose any charges, including attorney fees, to respond to a question |
|---|
| 437 | + | 13.32about any governing document or any aspect of the operation or management of the common |
|---|
| 438 | + | 13.33interest community posed by a unit owner to the association; |
|---|
| 439 | + | 13Article 2 Sec. 4. |
|---|
| 440 | + | REVISOR MS/AD 25-0391902/17/25 14.1 (13) provide for the indemnification of its officers and directors, and maintain directors' |
|---|
| 441 | + | 14.2and officers' liability insurance; |
|---|
| 442 | + | 14.3 (14) provide for reasonable procedures governing the conduct of meetings and election |
|---|
| 443 | + | 14.4of directors; and |
|---|
| 444 | + | 14.5 (15) exercise any other powers conferred by law, or by the declaration, articles of |
|---|
| 445 | + | 14.6incorporation or bylaws; and. |
|---|
| 446 | + | 14.7 (16) exercise any other powers necessary and proper for the governance and operation |
|---|
| 447 | + | 14.8of the association. |
|---|
| 448 | + | 14.9 (b) Notwithstanding subsection (a) the declaration or bylaws may not impose limitations |
|---|
| 449 | + | 14.10on the power of the association to deal with the declarant which are more restrictive than |
|---|
| 450 | + | 14.11the limitations imposed on the power of the association to deal with other persons. |
|---|
| 451 | + | 14.12 (c) An association must adopt and provide to every unit owner a policy regarding fines |
|---|
| 452 | + | 14.13that includes a list of the violations for which a fine may be imposed and a schedule of fines |
|---|
| 453 | + | 14.14for those violations. The association must provide the unit owner with a reasonable time to |
|---|
| 454 | + | 14.15correct the violation before a fine may be imposed. A fine levied pursuant to subsection |
|---|
| 455 | + | 14.16(a)(11), must be commensurate with the violation and must not exceed $100 for a single |
|---|
| 456 | + | 14.17violation, and when combined with additional fines for an ongoing violation, late fees, and |
|---|
| 457 | + | 14.18other allowable charges, must not exceed $2,500 in total for the violation. An association |
|---|
| 458 | + | 14.19that levies a fine pursuant to subsection (a)(11), or an assessment pursuant to section |
|---|
| 459 | + | 14.20515B.3-115(g), or 515B.3-1151(g), must provide a dated, written notice to a unit owner |
|---|
| 460 | + | 14.21that: |
|---|
| 461 | + | 14.22 (1) states the amount and reason for the fine or assessment; |
|---|
| 462 | + | 14.23 (2) for fines levied under section 515B.3-102(a)(11), specifies: (i) the violation for which |
|---|
| 463 | + | 14.24a fine is being levied and the date of the levy; and (ii) the specific section of the declaration, |
|---|
| 464 | + | 14.25bylaws, rules, or regulations allegedly violated; |
|---|
| 465 | + | 14.26 (3) for assessments levied under section 515B.3-115(g) or 515B.3-1151(g), identifies: |
|---|
| 466 | + | 14.27(i) the damage caused; and (ii) the act or omission alleged to have caused the damage; |
|---|
| 467 | + | 14.28 (4) states that all unpaid fines and assessments are liens which, if not satisfied, could |
|---|
| 468 | + | 14.29lead to foreclosure of the lien against the owner's unit; |
|---|
| 469 | + | 14.30 (5) describes the unit owner's right to be heard by the board or a committee appointed |
|---|
| 470 | + | 14.31by the board and the procedures for disputing the fine; |
|---|
| 471 | + | 14Article 2 Sec. 4. |
|---|
| 472 | + | REVISOR MS/AD 25-0391902/17/25 15.1 (6) states that if the assessment, fine, late fees, and other allowable charges are not paid, |
|---|
| 473 | + | 15.2the amount may increase as a result of the imposition of attorney fees and other collection |
|---|
| 474 | + | 15.3costs; and |
|---|
| 475 | + | 15.4 (7) informs the unit owner that homeownership assistance is available from the Minnesota |
|---|
| 476 | + | 15.5Homeownership Center. |
|---|
| 477 | + | 15.6 (d) Notwithstanding subsection (a), powers exercised under this section must comply |
|---|
| 478 | + | 15.7with sections 500.215, 500.216, and 500.217. |
|---|
| 479 | + | 15.8 (e) Notwithstanding subsection (a)(4) or any other provision of this chapter, the |
|---|
| 480 | + | 15.9association, before instituting litigation or arbitration involving construction defect claims |
|---|
| 481 | + | 15.10against a development party, shall: |
|---|
| 482 | + | 15.11 (1) mail or deliver written notice of the anticipated commencement of the action to each |
|---|
| 483 | + | 15.12unit owner at the addresses, if any, established for notices to owners in the declaration and, |
|---|
| 484 | + | 15.13if the declaration does not state how notices are to be given to owners, to the owner's last |
|---|
| 485 | + | 15.14known address. The notice shall specify the nature of the construction defect claims to be |
|---|
| 486 | + | 15.15alleged, the relief sought, and the manner in which the association proposes to fund the cost |
|---|
| 487 | + | 15.16of pursuing the construction defect claims; and |
|---|
| 488 | + | 15.17 (2) obtain the approval of owners of units to which a majority of the total votes in the |
|---|
| 489 | + | 15.18association are allocated. Votes allocated to units owned by the declarant, an affiliate of the |
|---|
| 490 | + | 15.19declarant, or a mortgagee who obtained ownership of the unit through a foreclosure sale |
|---|
| 491 | + | 15.20are excluded. The association may obtain the required approval by a vote at an annual or |
|---|
| 492 | + | 15.21special meeting of the members or, if authorized by the statute under which the association |
|---|
| 493 | + | 15.22is created and taken in compliance with that statute, by a vote of the members taken by |
|---|
| 494 | + | 15.23electronic means or mailed ballots. If the association holds a meeting and voting by electronic |
|---|
| 495 | + | 15.24means or mailed ballots is authorized by that statute, the association shall also provide for |
|---|
| 496 | + | 15.25voting by those methods. Section 515B.3-110(c) applies to votes taken by electronic means |
|---|
| 497 | + | 15.26or mailed ballots, except that the votes must be used in combination with the vote taken at |
|---|
| 498 | + | 15.27a meeting and are not in lieu of holding a meeting, if a meeting is held, and are considered |
|---|
| 499 | + | 15.28for purposes of determining whether a quorum was present. Proxies may not be used for a |
|---|
| 500 | + | 15.29vote taken under this paragraph unless the unit owner executes the proxy after receipt of |
|---|
| 501 | + | 15.30the notice required under subsection (e)(1) and the proxy expressly references this notice. |
|---|
| 502 | + | 15.31 (f) The association may intervene in a litigation or arbitration involving a construction |
|---|
| 503 | + | 15.32defect claim or assert a construction defect claim as a counterclaim, crossclaim, or third-party |
|---|
| 504 | + | 15.33claim before complying with subsections (e)(1) and (e)(2) but the association's complaint |
|---|
| 505 | + | 15.34in an intervention, counterclaim, crossclaim, or third-party claim shall be dismissed without |
|---|
| 506 | + | 15Article 2 Sec. 4. |
|---|
| 507 | + | REVISOR MS/AD 25-0391902/17/25 16.1prejudice unless the association has complied with the requirements of subsection (e) within |
|---|
| 508 | + | 16.290 days of the association's commencement of the complaint in an intervention or the |
|---|
| 509 | + | 16.3assertion of the counterclaim, crossclaim, or third-party claim. |
|---|
| 510 | + | 16.4 (g) Rules and regulations adopted must not be arbitrary or capricious and must otherwise |
|---|
| 511 | + | 16.5be reasonable. An association must give unit owners 60 days' advance notice of a board's |
|---|
| 512 | + | 16.6intention to adopt a new rule, or amend or revoke a rule. A rule change must be approved |
|---|
| 513 | + | 16.7at a board meeting, and an association must give homeowners the opportunity to comment |
|---|
| 514 | + | 16.8on the proposed rule change at the meeting at which the change is considered. Any rule in |
|---|
| 515 | + | 16.9effect may be revoked by a majority vote of the unit owners at a board meeting, where unit |
|---|
| 516 | + | 16.10owners may vote in person, by a written statement signed and dated by the unit owner prior |
|---|
| 517 | + | 16.11to the meeting at which revocation is considered, or by proxy. |
|---|
| 518 | + | 16.12 (h) Each association must adopt procedures for dispute resolution and the meet and |
|---|
| 519 | + | 16.13confer process as provided under section 515B.3-122. |
|---|
| 520 | + | 16.14 (i) Associations must not sell or assign any debt owed by a unit owner. |
|---|
| 521 | + | 16.15 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 522 | + | 16.16Sec. 5. Minnesota Statutes 2024, section 515B.3-103, is amended to read: |
|---|
| 523 | + | 16.17 515B.3-103 BOARD OF DIRECTORS, OFFICERS AND DECLARANT |
|---|
| 524 | + | 16.18CONTROL. |
|---|
| 525 | + | 16.19 (a) An association shall be governed by a board of directors whose appointment or |
|---|
| 526 | + | 16.20election shall occur no later than the date of creation of the common interest community |
|---|
| 527 | + | 16.21and shall be reflected in the association's records. Except as expressly prohibited by the |
|---|
| 528 | + | 16.22declaration, the articles of incorporation, bylaws, subsection (b), or other provisions of this |
|---|
| 529 | + | 16.23chapter, the board may act in all instances on behalf of the association. In the performance |
|---|
| 530 | + | 16.24of their duties, the officers and directors are required to exercise (i) if appointed by the |
|---|
| 531 | + | 16.25declarant, the care required of fiduciaries of the unit owners and (ii) if elected by the unit |
|---|
| 532 | + | 16.26owners, the care required of a director by section 302A.251, 308B.455, 308C.455, or |
|---|
| 533 | + | 16.27317A.251, as applicable. The officers and directors appointed by the declarant shall have |
|---|
| 534 | + | 16.28a duty to fulfill, and to cause the association to fulfill, their respective obligations under the |
|---|
| 535 | + | 16.29declaration, bylaws, articles of incorporation, and this chapter and to enforce the provisions |
|---|
| 536 | + | 16.30of the declaration, bylaws, articles of incorporation, and this chapter against all unit owners, |
|---|
| 537 | + | 16.31including the declarant and its affiliates, in a uniform and fair manner. The standards of |
|---|
| 538 | + | 16.32conduct for officers and directors set forth in this subsection shall also apply to the officers |
|---|
| 539 | + | 16.33and directors of master associations in the exercise of their duties on behalf of the master |
|---|
| 540 | + | 16Article 2 Sec. 5. |
|---|
| 541 | + | REVISOR MS/AD 25-0391902/17/25 17.1association. The association must provide a publication to each director explaining in plain |
|---|
| 542 | + | 17.2language: |
|---|
| 543 | + | 17.3 (1) the role of a director under this chapter; and |
|---|
| 544 | + | 17.4 (2) all the rights and responsibilities of a director and the board of directors under this |
|---|
| 545 | + | 17.5chapter. |
|---|
| 546 | + | 17.6 (b) The board may not act unilaterally to amend the declaration, to terminate the common |
|---|
| 547 | + | 17.7interest community, to elect directors to the board, or to determine the qualifications, powers |
|---|
| 548 | + | 17.8and duties, or terms of office of directors, but the board may fill vacancies in its membership |
|---|
| 549 | + | 17.9created other than by removal by the vote of the association members for the unexpired |
|---|
| 550 | + | 17.10portion of any term. |
|---|
| 551 | + | 17.11 (c) The declaration may provide for a period of declarant control of the association, |
|---|
| 552 | + | 17.12during which a declarant, or persons designated by the declarant, may appoint and remove |
|---|
| 553 | + | 17.13the officers and directors of the association. The period of declarant control begins on the |
|---|
| 554 | + | 17.14date of creation of the common interest community and terminates upon the earliest of the |
|---|
| 555 | + | 17.15following events: (i) five years after the date of the first conveyance of a unit to a unit owner |
|---|
| 556 | + | 17.16other than a declarant in the case of a flexible common interest community or three years |
|---|
| 557 | + | 17.17in the case of any other common interest community, (ii) the declarant's voluntary surrender |
|---|
| 558 | + | 17.18of control by giving written notice to the unit owners pursuant to section 515B.1-115, or |
|---|
| 559 | + | 17.19(iii) the conveyance of 75 percent of the units to unit owners other than a declarant. |
|---|
| 560 | + | 17.20 (d) The board shall cause a meeting of the unit owners to be called, as follows: |
|---|
| 561 | + | 17.21 (1) If the period of declarant control has terminated pursuant to subsection (c), a meeting |
|---|
| 562 | + | 17.22of the unit owners shall be called and held within 60 days after said termination, at which |
|---|
| 563 | + | 17.23the board shall be appointed or elected by all unit owners, including declarant, subject to |
|---|
| 564 | + | 17.24the requirements of subsection (e). |
|---|
| 565 | + | 17.25 (2) If 50 percent of the units that a declarant is authorized by the declaration to create |
|---|
| 566 | + | 17.26have been conveyed prior to the termination of the declarant control period, a meeting of |
|---|
| 567 | + | 17.27the unit owners shall be called and held within 60 days thereafter, at which not less than |
|---|
| 568 | + | 17.2833-1/3 percent of the members of the board shall be elected by unit owners other than a |
|---|
| 569 | + | 17.29declarant or an affiliate of a declarant. |
|---|
| 570 | + | 17.30 (3) If the board fails or refuses to cause a meeting of the unit owners required to be called |
|---|
| 571 | + | 17.31pursuant to subsection (d), then the unit owners other than a declarant and its affiliates may |
|---|
| 572 | + | 17.32cause the meeting to be called pursuant to the applicable provisions of the law under which |
|---|
| 573 | + | 17.33the association was created. The declarant and its affiliates shall be deemed to be present |
|---|
| 574 | + | 17Article 2 Sec. 5. |
|---|
| 575 | + | REVISOR MS/AD 25-0391902/17/25 18.1at the meeting for purposes of establishing a quorum regardless of their failure to attend the |
|---|
| 576 | + | 18.2meeting. |
|---|
| 577 | + | 18.3 (e) Following the termination of any period of declarant control, the unit owners shall |
|---|
| 578 | + | 18.4appoint or elect the board. All unit owners, including the declarant and its affiliates, may |
|---|
| 579 | + | 18.5cast the votes allocated to any units owned by them. The board shall thereafter be subject |
|---|
| 580 | + | 18.6to the following: |
|---|
| 581 | + | 18.7 (1) Unless otherwise approved by a vote of unit owners other than the declarant or an |
|---|
| 582 | + | 18.8affiliate of the declarant, a majority of the directors shall be unit owners or a natural person |
|---|
| 583 | + | 18.9designated by a unit owner that is not a natural person, other than a declarant or an affiliate |
|---|
| 584 | + | 18.10of a declarant. The remaining directors need not be unit owners unless required by the |
|---|
| 585 | + | 18.11articles of incorporation or bylaws. |
|---|
| 586 | + | 18.12 (2) Subject to the requirements of subsection (e)(1), the articles of incorporation or |
|---|
| 587 | + | 18.13bylaws may authorize the declarant or a person designated by the declarant to appoint one |
|---|
| 588 | + | 18.14director, who need not be a member. The articles of incorporation or bylaws shall not be |
|---|
| 589 | + | 18.15amended to change or terminate the authorization to appoint one director without the written |
|---|
| 590 | + | 18.16consent of the declarant or other person possessing the power to appoint. |
|---|
| 591 | + | 18.17 (3) Subject to the requirements of subsection (e)(1), the articles of incorporation or |
|---|
| 592 | + | 18.18bylaws may authorize special classes of directors and director voting rights, as follows: (i) |
|---|
| 593 | + | 18.19classes of directors, (ii) the appointment or election of directors in certain classes by certain |
|---|
| 594 | + | 18.20classes of members, or (iii) class voting by classes of directors on issues affecting only a |
|---|
| 595 | + | 18.21certain class or classes of members, units, or other parcels of real estate, or to otherwise |
|---|
| 596 | + | 18.22protect the legitimate interest of such class or classes. No person may utilize such special |
|---|
| 597 | + | 18.23classes or class voting for the purpose of evading any limitation imposed on declarants by |
|---|
| 598 | + | 18.24this chapter. |
|---|
| 599 | + | 18.25 (4) The board shall elect the officers. The directors and officers shall take office upon |
|---|
| 600 | + | 18.26election. |
|---|
| 601 | + | 18.27 (f) In determining whether the period of declarant control has terminated under subsection |
|---|
| 602 | + | 18.28(c), or whether unit owners other than a declarant are entitled to elect members of the board |
|---|
| 603 | + | 18.29of directors under subsection (d), the percentage of the units conveyed shall be calculated |
|---|
| 604 | + | 18.30using as a numerator the number of units conveyed and as a denominator the number of |
|---|
| 605 | + | 18.31units subject to the declaration plus the number of units which the declarant is authorized |
|---|
| 606 | + | 18.32by the declaration to create on any additional real estate. The percentages referred to in |
|---|
| 607 | + | 18.33subsections (c) and (d) shall be calculated without reference to units that are auxiliary to |
|---|
| 608 | + | 18Article 2 Sec. 5. |
|---|
| 609 | + | REVISOR MS/AD 25-0391902/17/25 19.1other units, such as garage units or storage units. A person shall not use a master association |
|---|
| 610 | + | 19.2or other device to evade the requirements of this section. |
|---|
| 611 | + | 19.3 (g) Except as otherwise provided in this subsection, all meetings of the board of directors |
|---|
| 612 | + | 19.4must be open to the unit owners. To the extent practicable, The board shall give reasonable |
|---|
| 613 | + | 19.5notice to the unit owners of the date, time, and place, and agenda of a board meeting. If the |
|---|
| 614 | + | 19.6date, time, and place of meetings are provided for in the declaration, articles, or bylaws, |
|---|
| 615 | + | 19.7announced at a previous meeting of the board, posted in a location accessible to the unit |
|---|
| 616 | + | 19.8owners and designated by the board from time to time, or if an emergency requires immediate |
|---|
| 617 | + | 19.9consideration of a matter by the board, notice is not required. "Notice" has the meaning |
|---|
| 618 | + | 19.10given in section 317A.011, subdivision 14. Prior to the board taking action on an agenda |
|---|
| 619 | + | 19.11item, any unit owner or any person designated in writing by a member as the member's |
|---|
| 620 | + | 19.12representative must be permitted to attend and speak during any meeting on any subject |
|---|
| 621 | + | 19.13that is on the meeting agenda. A time must be designated by the board at each meeting for |
|---|
| 622 | + | 19.14any unit owner, or the unit owner's designee, to raise any issue that is not on the meeting |
|---|
| 623 | + | 19.15agenda and that is related to the association or the common interest community. The board |
|---|
| 624 | + | 19.16may place a reasonable limit on the time a member is allowed to speak. Meetings may occur |
|---|
| 625 | + | 19.17virtually but an association must provide access to all members to assert their right under |
|---|
| 626 | + | 19.18this section, including technical assistance to participate in virtual meetings and electronic |
|---|
| 627 | + | 19.19voting. Meetings may be closed to discuss the following: |
|---|
| 628 | + | 19.20 (1) personnel matters; |
|---|
| 629 | + | 19.21 (2) pending or potential litigation, arbitration or other potentially adversarial proceedings, |
|---|
| 630 | + | 19.22between unit owners, between the board or association and unit owners, or other matters in |
|---|
| 631 | + | 19.23which any unit owner may have an adversarial interest, if the board determines that closing |
|---|
| 632 | + | 19.24the meeting is necessary to discuss strategy or to otherwise protect the position of the board |
|---|
| 633 | + | 19.25or association or the privacy of a unit owner or occupant of a unit; or |
|---|
| 634 | + | 19.26 (3) criminal activity arising within the common interest community if the board |
|---|
| 635 | + | 19.27determines that closing the meeting is necessary to protect the privacy of the victim or that |
|---|
| 636 | + | 19.28opening the meeting would jeopardize investigation of the activity. |
|---|
| 637 | + | 19.29 Nothing in this subsection imposes a duty on the board to provide special facilities for |
|---|
| 638 | + | 19.30meetings. The failure to give notice as required by this subsection shall not invalidate the |
|---|
| 639 | + | 19.31board meeting or any action taken at the meeting. The minutes of any part of a meeting that |
|---|
| 640 | + | 19.32is closed under this subsection may be kept confidential at the discretion of the board. |
|---|
| 641 | + | 19.33 (h) The conflict of interest standards set forth in section 317A.255 are required of officers |
|---|
| 642 | + | 19.34and directors and apply to an actual or potential conflict of interest that arises concerning |
|---|
| 643 | + | 19Article 2 Sec. 5. |
|---|
| 644 | + | REVISOR MS/AD 25-0391902/17/25 20.1an officer or director, regardless of whether appointed or elected, provided that no board |
|---|
| 645 | + | 20.2member may: |
|---|
| 646 | + | 20.3 (1) have any financial interest in a business in which the association or any board member |
|---|
| 647 | + | 20.4has a contract or other business relationship; |
|---|
| 648 | + | 20.5 (2) solicit or accept any form of direct or indirect compensation, gift, money, rebate, |
|---|
| 649 | + | 20.6gratuity, remuneration of any kind, or anything of value from any person or entity performing |
|---|
| 650 | + | 20.7services for the association or a board member or any person or entity with which the |
|---|
| 651 | + | 20.8association or a board member has a contract or other business relationship; |
|---|
| 652 | + | 20.9 (3) solicit or accept any gift, money, rebate, any form of direct or indirect compensation, |
|---|
| 653 | + | 20.10gratuity, remuneration of any kind, or anything of value that would improperly influence |
|---|
| 654 | + | 20.11or would appear to a reasonable person to improperly influence the decisions made by the |
|---|
| 655 | + | 20.12association, the board, or the management company or would result or would appear to a |
|---|
| 656 | + | 20.13reasonable person to result in a conflict of interest for the management company, its owner |
|---|
| 657 | + | 20.14or owners, managerial officials, or any employee of the management company; or |
|---|
| 658 | + | 20.15 (4) enter into a contract or any other business relationship on behalf of an association |
|---|
| 659 | + | 20.16or a board member from which the management company, its owner or owners, any of its |
|---|
| 660 | + | 20.17managerial officials, or any of its employees or any spouse, domestic partner, or relative of |
|---|
| 661 | + | 20.18the owner or owners, managerial officials, or any employee of the management company |
|---|
| 662 | + | 20.19has received or could receive a direct or indirect financial benefit of any amount. |
|---|
| 663 | + | 20.20 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 664 | + | 20.21Sec. 6. Minnesota Statutes 2024, section 515B.3-106, is amended to read: |
|---|
| 665 | + | 20.22 515B.3-106 BYLAWS; ANNUAL REPORT. |
|---|
| 666 | + | 20.23 (a) A common interest community shall have bylaws which comply with this chapter |
|---|
| 667 | + | 20.24and the statute under which the association is incorporated. The bylaws and any amendments |
|---|
| 668 | + | 20.25may be recorded, but need not be recorded to be effective unless so provided in the bylaws. |
|---|
| 669 | + | 20.26Any amendment, addition, or repeal of the bylaws must be approved at a board meeting, |
|---|
| 670 | + | 20.27and an association must give homeowners the opportunity to comment on the proposed |
|---|
| 671 | + | 20.28change at the meeting at which the change is considered. Any bylaw in effect may be revoked |
|---|
| 672 | + | 20.29by a majority vote of the unit owners at a board meeting, where unit owners may vote in |
|---|
| 673 | + | 20.30person, by a written statement signed and dated by the unit owner prior to the meeting at |
|---|
| 674 | + | 20.31which revocation is considered, or by proxy. |
|---|
| 675 | + | 20.32 (b) The bylaws shall provide that, in addition to any statutory requirements: |
|---|
| 676 | + | 20Article 2 Sec. 6. |
|---|
| 677 | + | REVISOR MS/AD 25-0391902/17/25 21.1 (1) A meeting of the members shall be held at least once each year, and a specified |
|---|
| 678 | + | 21.2officer of the association shall give notice of the meeting as provided in section 515B.3-108. |
|---|
| 679 | + | 21.3 (2) An annual report shall be prepared by the association and a copy of the report shall |
|---|
| 680 | + | 21.4be provided to each unit owner at or prior to the annual meeting. |
|---|
| 681 | + | 21.5 (c) The annual report shall contain at a minimum: |
|---|
| 682 | + | 21.6 (1) a statement of any capital expenditures in excess of two percent of the current budget |
|---|
| 683 | + | 21.7or $5,000, whichever is greater, approved by the association for the current fiscal year or |
|---|
| 684 | + | 21.8succeeding two fiscal years; |
|---|
| 685 | + | 21.9 (2) a statement of the association's total replacement reserves, the components of the |
|---|
| 686 | + | 21.10common interest community for which the reserves are set aside, and the amounts of the |
|---|
| 687 | + | 21.11reserves, if any, that the board has allocated for the replacement of each of those components; |
|---|
| 688 | + | 21.12 (3) a copy of the statement of revenues and expenses for the association's last fiscal year, |
|---|
| 689 | + | 21.13and a balance sheet as of the end of said fiscal year; |
|---|
| 690 | + | 21.14 (4) a statement of the status of any pending litigation or judgments to which the |
|---|
| 691 | + | 21.15association is a party; |
|---|
| 692 | + | 21.16 (5) a detailed description of the insurance coverage provided by the association including |
|---|
| 693 | + | 21.17a statement as to which, if any, of the items referred to in section 515B.3-113, subsection |
|---|
| 694 | + | 21.18(b), are insured by the association; and |
|---|
| 695 | + | 21.19 (6) a statement of the total past due assessments on all units, current as of not more than |
|---|
| 696 | + | 21.2060 days prior to the date of the meeting. |
|---|
| 697 | + | 21.21 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 698 | + | 21.22Sec. 7. Minnesota Statutes 2024, section 515B.3-107, is amended to read: |
|---|
| 699 | + | 21.23 515B.3-107 UPKEEP OF COMMON INTEREST COMMUNITY . |
|---|
| 700 | + | 21.24 (a) Except to the extent provided by the declaration, this subsection or section |
|---|
| 701 | + | 21.25515B.3-113, the association is responsible for the maintenance, repair and replacement of |
|---|
| 702 | + | 21.26the common elements, and each unit owner is responsible for the maintenance, repair and |
|---|
| 703 | + | 21.27replacement of the unit owner's unit. A management company may not require an association |
|---|
| 704 | + | 21.28to work with a particular vendor. Damage to the common elements or any unit as a result |
|---|
| 705 | + | 21.29of the acts or omissions of a unit owner or the association, including damage resulting from |
|---|
| 706 | + | 21.30the unit owner's or association's lack of maintenance or failure to perform necessary repairs |
|---|
| 707 | + | 21.31or replacement, is the responsibility of the unit owner or association responsible for causing |
|---|
| 708 | + | 21Article 2 Sec. 7. |
|---|
| 709 | + | REVISOR MS/AD 25-0391902/17/25 22.1the damage, or whose agents or, subject to section 515B.3-115, subsection (g), and section |
|---|
| 710 | + | 22.2515B.3-1151, subsection (g), invitees caused the damage. |
|---|
| 711 | + | 22.3 (b) The association's board of directors shall prepare and approve a written preventative |
|---|
| 712 | + | 22.4maintenance plan, maintenance schedule, and maintenance budget for the common elements. |
|---|
| 713 | + | 22.5The association shall follow the approved preventative maintenance plan. The association's |
|---|
| 714 | + | 22.6board may amend, modify, or replace an approved preventative maintenance plan or an |
|---|
| 715 | + | 22.7approved maintenance schedule from time to time. The association must provide all unit |
|---|
| 716 | + | 22.8owners with a paper copy, electronic copy, or electronic access to the preventative |
|---|
| 717 | + | 22.9maintenance plan, the maintenance schedule, and any amendments or modifications to or |
|---|
| 718 | + | 22.10replacements of the preventative maintenance plan and the maintenance schedule. If a |
|---|
| 719 | + | 22.11common interest community was created on or before August 1, 2017, the association's |
|---|
| 720 | + | 22.12board of directors shall have until January 1, 2019, to comply with the requirements of this |
|---|
| 721 | + | 22.13subsection. |
|---|
| 722 | + | 22.14 (c) The association shall have access through and into each unit for purposes of |
|---|
| 723 | + | 22.15performing maintenance, repair or replacement for which the association may be responsible. |
|---|
| 724 | + | 22.16The association and any public safety personnel shall also have access for purposes of |
|---|
| 725 | + | 22.17abating or correcting any condition in the unit which violates any governmental law, |
|---|
| 726 | + | 22.18ordinance or regulation, which may cause material damage to or jeopardize the safety of |
|---|
| 727 | + | 22.19the common interest community, or which may constitute a health or safety hazard for |
|---|
| 728 | + | 22.20occupants of units. |
|---|
| 729 | + | 22.21 (d) Neither the association, nor any unit owner other than the declarant or its affiliates, |
|---|
| 730 | + | 22.22is subject to a claim for payment of expenses incurred in connection with any additional |
|---|
| 731 | + | 22.23real estate. |
|---|
| 732 | + | 22.24 (e) In exercising any authority granted to it under the declaration to approve or disapprove |
|---|
| 733 | + | 22.25proposed changes to a unit or limited common element, the association's board shall provide |
|---|
| 734 | + | 22.26a fair, reasonable, and expeditious procedure for making any decision. The procedure shall |
|---|
| 735 | + | 22.27be set forth in the association's governing documents. The procedures shall state the |
|---|
| 736 | + | 22.28maximum time for issuance of any decision on a proposal or a request for consideration. |
|---|
| 737 | + | 22.29At a minimum, the association's board must make a decision within 90 days after the initial |
|---|
| 738 | + | 22.30submission of the proposal or submission of any additional information or changes to the |
|---|
| 739 | + | 22.31proposal requested by the association's board in response to the initial submission. A decision |
|---|
| 740 | + | 22.32must be in writing, must be made in good faith, and must not be unreasonable, arbitrary, or |
|---|
| 741 | + | 22.33capricious. If the proposal is disapproved, the decision must include both an explanation of |
|---|
| 742 | + | 22.34why the proposal is disapproved and a description of the procedure for reconsideration of |
|---|
| 743 | + | 22.35the decision by the association's board. |
|---|
| 744 | + | 22Article 2 Sec. 7. |
|---|
| 745 | + | REVISOR MS/AD 25-0391902/17/25 23.1 (f) Unless expressly provided for in the declaration, the association must not enforce |
|---|
| 746 | + | 23.2any restriction on parking of a personal vehicle on a public street or public road for which |
|---|
| 747 | + | 23.3the state or local government has assumed responsibility for maintenance and repairs, unless |
|---|
| 748 | + | 23.4the authority to regulate such parking has been expressly delegated to the association by |
|---|
| 749 | + | 23.5the state or local government under terms prescribing the manner in which the association |
|---|
| 750 | + | 23.6may exercise that authority. Any such delegation is valid for a period not to exceed five |
|---|
| 751 | + | 23.7years, at which time the association must reapply to the delegating entity. As used in this |
|---|
| 752 | + | 23.8subsection, "personal vehicle" means an automobile with a gross weight of less than 26,001 |
|---|
| 753 | + | 23.9pounds that is used for personal pleasure, travel, or commuting to and from a place of work, |
|---|
| 754 | + | 23.10and does not include a motor home or self-propelled recreational vehicle, or an automobile |
|---|
| 755 | + | 23.11that is otherwise used primarily in connection with any commercial endeavor or business. |
|---|
| 756 | + | 23.12 (g) A unit owner or resident may park a work vehicle, including but not limited to a van, |
|---|
| 757 | + | 23.13pickup truck, small truck, ambulance, law enforcement vehicle, utility company vehicle, or |
|---|
| 758 | + | 23.14emergency response vehicle, on the unit owner's property or curtilage, provided the vehicle's |
|---|
| 759 | + | 23.15length does not encroach on another unit owner's property or interfere with the association's |
|---|
| 760 | + | 23.16ability to maintain roads or common elements. An association must not prohibit or restrict |
|---|
| 761 | + | 23.17this parking. |
|---|
| 762 | + | 23.18 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 763 | + | 23.19Sec. 8. Minnesota Statutes 2024, section 515B.3-108, is amended to read: |
|---|
| 764 | + | 23.20 515B.3-108 MEETINGS. |
|---|
| 765 | + | 23.21 (a) A meeting of the association shall be held at least once each year. At each annual |
|---|
| 766 | + | 23.22meeting, there shall be, at a minimum, (i) an election of successor directors for those directors |
|---|
| 767 | + | 23.23whose terms have expired, (ii) a report on the activities and financial condition of the |
|---|
| 768 | + | 23.24association, and (iii) consideration of and action on any other matters included in the notice |
|---|
| 769 | + | 23.25of meeting. Unless the bylaws provide otherwise, special meetings of the association may |
|---|
| 770 | + | 23.26be called by the president and shall be called by the president or secretary upon the written |
|---|
| 771 | + | 23.27petition of a majority of the board or unit owners entitled to cast at least 20 percent of the |
|---|
| 772 | + | 23.28votes in the association. |
|---|
| 773 | + | 23.29 (b) Not less than 21 nor more than 30 days in advance of any annual meeting, and not |
|---|
| 774 | + | 23.30less than seven nor more than 30 days in advance of any special meeting, the secretary or |
|---|
| 775 | + | 23.31other officer specified in the bylaws shall cause notice to be hand delivered or sent postage |
|---|
| 776 | + | 23.32prepaid by United States mail to the mailing address of each unit, or to any other address |
|---|
| 777 | + | 23.33designated in writing by the unit owner to the association as provided in the bylaws or by |
|---|
| 778 | + | 23.34statute. |
|---|
| 779 | + | 23Article 2 Sec. 8. |
|---|
| 780 | + | REVISOR MS/AD 25-0391902/17/25 24.1 (c) The notice of any meeting shall state the date, time and place of the meeting, the |
|---|
| 781 | + | 24.2purposes of the meeting, and, if proxies are permitted, the procedures for appointing proxies. |
|---|
| 782 | + | 24.3The notice must include copies of any documents that are subject to discussion or approval |
|---|
| 783 | + | 24.4at the meeting, including the budget. |
|---|
| 784 | + | 24.5 (d) The board may provide for reasonable procedures governing the conduct of meetings |
|---|
| 785 | + | 24.6and elections. |
|---|
| 786 | + | 24.7 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 787 | + | 24.8 Sec. 9. Minnesota Statutes 2024, section 515B.3-110, is amended to read: |
|---|
| 788 | + | 24.9 515B.3-110 VOTING; PROXIES. |
|---|
| 789 | + | 24.10 (a) At any meeting of the association an owner or the holder of the owner's proxy shall |
|---|
| 790 | + | 24.11be entitled to cast the vote which is allocated to the unit. If there is more than one owner of |
|---|
| 791 | + | 24.12a unit, only one of the owners may cast the vote. If the owners of a unit fail to agree and |
|---|
| 792 | + | 24.13notify the association as to who shall cast the vote, the vote shall not be cast. Any provision |
|---|
| 793 | + | 24.14in the articles of incorporation, bylaws, declaration, or other document restricting a unit |
|---|
| 794 | + | 24.15owner's right to vote, or affecting quorum requirements, by reason of nonpayment of |
|---|
| 795 | + | 24.16assessments, or a purported violation of any provision of the documents governing the |
|---|
| 796 | + | 24.17common interest community, shall be void. |
|---|
| 797 | + | 24.18 (b) If permitted by the articles or bylaws, votes allocated to a unit may be cast pursuant |
|---|
| 798 | + | 24.19to a proxy executed by the unit owner entitled to cast the vote for that unit. The board may |
|---|
| 799 | + | 24.20specify the form of proxy and proxy rules, consistent with law. A current board member |
|---|
| 800 | + | 24.21cannot act as a proxy for a unit owner. No more than 20 percent of votes cast on any single |
|---|
| 801 | + | 24.22vote can be by proxy. |
|---|
| 802 | + | 24.23 (c) Except as provided in section 515B.3-106, if authorized by the statute under which |
|---|
| 803 | + | 24.24the association is created, and to the extent not limited or prohibited by the articles of |
|---|
| 804 | + | 24.25incorporation, bylaws, or declaration, the vote on any issue or issues may be taken by |
|---|
| 805 | + | 24.26electronic means or by mailed ballots, in compliance with the applicable statute, in lieu of |
|---|
| 806 | + | 24.27holding a meeting of the unit owners. Such a vote shall have the force and effect of a vote |
|---|
| 807 | + | 24.28taken at a meeting; provided, that the total votes cast are at least equal to the votes required |
|---|
| 808 | + | 24.29for a quorum. The board shall set a voting period within which the ballots or other voting |
|---|
| 809 | + | 24.30response must be received by the association, which period shall be not less than 15 nor |
|---|
| 810 | + | 24.31more than 45 days after the date of delivery of the notice of the vote and voting procedures |
|---|
| 811 | + | 24.32to the unit owners. The board of directors shall provide notice of the results of the vote to |
|---|
| 812 | + | 24.33the unit owners within 30 days after the expiration of the voting period. All requirements |
|---|
| 813 | + | 24Article 2 Sec. 9. |
|---|
| 814 | + | REVISOR MS/AD 25-0391902/17/25 25.1in this chapter, the declaration or the bylaws for a meeting of the unit owners, or being |
|---|
| 815 | + | 25.2present in person, shall be deemed satisfied by a vote taken in compliance with the |
|---|
| 816 | + | 25.3requirements of this section. The voting procedures authorized by this section shall not be |
|---|
| 817 | + | 25.4used in combination with a vote taken at a meeting of the unit owners. However, voting by |
|---|
| 818 | + | 25.5electronic means and mailed ballot may be combined if each is done in compliance with |
|---|
| 819 | + | 25.6the applicable statute. |
|---|
| 820 | + | 25.7 (d) The articles of incorporation or bylaws may authorize class voting by unit owners |
|---|
| 821 | + | 25.8for directors or on specified issues affecting the class. Class voting may only be used to |
|---|
| 822 | + | 25.9address operational, physical, or administrative differences within the common interest |
|---|
| 823 | + | 25.10community. A declarant shall not use class voting to evade any limit imposed on declarants |
|---|
| 824 | + | 25.11by this chapter and units shall not constitute a class because they are owned by a declarant. |
|---|
| 825 | + | 25.12 (e) The declaration or bylaws may provide that votes on specified matters affecting the |
|---|
| 826 | + | 25.13common interest community be cast by lessees or secured parties rather than unit owners; |
|---|
| 827 | + | 25.14provided that (i) the provisions of subsections (a), (b), and (c) apply to those persons as if |
|---|
| 828 | + | 25.15they were unit owners; (ii) unit owners who have so delegated their votes to other persons |
|---|
| 829 | + | 25.16may not cast votes on those specified matters; (iii) lessees or secured parties are entitled to |
|---|
| 830 | + | 25.17notice of meetings, access to records, and other rights respecting those matters as if they |
|---|
| 831 | + | 25.18were unit owners, and (iv) the lessee or secured party has filed satisfactory evidence of its |
|---|
| 832 | + | 25.19interest with the secretary of the association prior to the meeting. Unit owners must also be |
|---|
| 833 | + | 25.20given notice, in the manner provided in section 515B.3-108(b), of meetings at which lessees |
|---|
| 834 | + | 25.21or secured parties are entitled to vote. |
|---|
| 835 | + | 25.22 (f) No votes allocated to a unit owned by the association may be cast nor counted toward |
|---|
| 836 | + | 25.23a quorum. |
|---|
| 837 | + | 25.24 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 838 | + | 25.25Sec. 10. Minnesota Statutes 2024, section 515B.3-115, is amended to read: |
|---|
| 839 | + | 25.26 515B.3-115 ASSESSMENTS FOR COMMON EXPENSES; CIC CREATED |
|---|
| 840 | + | 25.27BEFORE AUGUST 1, 2010. |
|---|
| 841 | + | 25.28 (a) The obligation of a unit owner to pay common expense assessments shall be as |
|---|
| 842 | + | 25.29follows: |
|---|
| 843 | + | 25.30 (1) If a common expense assessment has not been levied, the declarant shall pay all |
|---|
| 844 | + | 25.31operating expenses of the common interest community, and shall fund the replacement |
|---|
| 845 | + | 25.32reserve component of the common expenses as required by subsection (b). |
|---|
| 846 | + | 25Article 2 Sec. 10. |
|---|
| 847 | + | REVISOR MS/AD 25-0391902/17/25 26.1 (2) If a common expense assessment has been levied, all unit owners, including the |
|---|
| 848 | + | 26.2declarant, shall pay the assessments allocated to their units, subject to the following: |
|---|
| 849 | + | 26.3 (i) If the declaration so provides, a declarant's liability, and the assessment lien, for the |
|---|
| 850 | + | 26.4common expense assessments, exclusive of replacement reserves, on any unit owned by |
|---|
| 851 | + | 26.5the declarant may be limited to 25 percent or more of any assessment, exclusive of |
|---|
| 852 | + | 26.6replacement reserves, until the unit or any building located in the unit is substantially |
|---|
| 853 | + | 26.7completed. Substantial completion shall be evidenced by a certificate of occupancy in any |
|---|
| 854 | + | 26.8jurisdiction that issues the certificate. |
|---|
| 855 | + | 26.9 (ii) If the declaration provides for a reduced assessment pursuant to paragraph (2)(i), |
|---|
| 856 | + | 26.10the declarant shall be obligated, within 60 days following the termination of the period of |
|---|
| 857 | + | 26.11declarant control, to make up any operating deficit incurred by the association during the |
|---|
| 858 | + | 26.12period of declarant control. The existence and amount, if any, of the operating deficit shall |
|---|
| 859 | + | 26.13be determined using the accrual basis of accounting applied as of the date of termination |
|---|
| 860 | + | 26.14of the period of declarant control, regardless of the accounting methodology previously |
|---|
| 861 | + | 26.15used by the association to maintain its accounts. |
|---|
| 862 | + | 26.16 (b) The replacement reserve component of the common expenses shall be funded for |
|---|
| 863 | + | 26.17each unit in accordance with the projected annual budget required by section |
|---|
| 864 | + | 26.18515B.4-102(a)(23) provided that the funding of replacement reserves with respect to a unit |
|---|
| 865 | + | 26.19shall commence no later than the date that the unit or any building located within the unit |
|---|
| 866 | + | 26.20boundaries is substantially completed. Substantial completion shall be evidenced by a |
|---|
| 867 | + | 26.21certificate of occupancy in any jurisdiction that issues the certificate. |
|---|
| 868 | + | 26.22 (c) After an assessment has been levied by the association, assessments shall be levied |
|---|
| 869 | + | 26.23at least annually, based upon a budget approved at least annually by the association. The |
|---|
| 870 | + | 26.24association shall provide each member of the homeowners association with a copy of the |
|---|
| 871 | + | 26.25proposed annual budget prior to the annual meeting at which the budget is to be approved |
|---|
| 872 | + | 26.26and allow member input on the budget prior to or during the meeting. |
|---|
| 873 | + | 26.27 (d) Except as modified by subsections (a)(1) and (2), (e), (f), and (g), all common |
|---|
| 874 | + | 26.28expenses shall be assessed against all the units in accordance with the allocations established |
|---|
| 875 | + | 26.29by the declaration pursuant to section 515B.2-108. |
|---|
| 876 | + | 26.30 (e) Unless otherwise required by the declaration: |
|---|
| 877 | + | 26.31 (1) any common expense associated with the maintenance, repair, or replacement of a |
|---|
| 878 | + | 26.32limited common element shall be assessed against the units to which that limited common |
|---|
| 879 | + | 26.33element is assigned, equally, or in any other proportion the declaration provides; |
|---|
| 880 | + | 26Article 2 Sec. 10. |
|---|
| 881 | + | REVISOR MS/AD 25-0391902/17/25 27.1 (2) any common expense or portion thereof benefiting fewer than all of the units may |
|---|
| 882 | + | 27.2be assessed exclusively against the units benefited, equally, or in any other proportion the |
|---|
| 883 | + | 27.3declaration provides; |
|---|
| 884 | + | 27.4 (3) the costs of insurance may be assessed in proportion to risk or coverage, and the |
|---|
| 885 | + | 27.5costs of utilities may be assessed in proportion to usage; |
|---|
| 886 | + | 27.6 (4) subject to subsection (k) and section 515B.3-102(a)(11), reasonable attorney fees |
|---|
| 887 | + | 27.7and costs incurred by the association in connection with (i) the collection of assessments |
|---|
| 888 | + | 27.8against a unit owner, and (ii) the enforcement of this chapter, the articles, bylaws, declaration, |
|---|
| 889 | + | 27.9or rules and regulations against a unit owner, may be assessed against the unit owner's unit |
|---|
| 890 | + | 27.10subject to section 515B.3-116(h), provided that the attorney fees and costs for enforcement |
|---|
| 891 | + | 27.11and collection may not exceed $1,500 and no fees or costs may be assessed if the association |
|---|
| 892 | + | 27.12uses a collection agency as defined in section 332.31 if the fees of the collection agency are |
|---|
| 893 | + | 27.13contingent on the amount collected; and |
|---|
| 894 | + | 27.14 (5) subject to subsection (k), fees, charges, late charges, and fines and interest may be |
|---|
| 895 | + | 27.15assessed as provided in section 515B.3-116(a). |
|---|
| 896 | + | 27.16 (f) Assessments levied under section 515B.3-116 to pay a judgment against the association |
|---|
| 897 | + | 27.17may be levied only against the units in the common interest community at the time the |
|---|
| 898 | + | 27.18judgment was entered, in proportion to their common expense liabilities. |
|---|
| 899 | + | 27.19 (g) If any damage to the common elements or another unit is caused by the act or omission |
|---|
| 900 | + | 27.20of any unit owner, or occupant of a unit, or their invitees, the association may assess the |
|---|
| 901 | + | 27.21costs of repairing the damage exclusively against the unit owner's unit to the extent not |
|---|
| 902 | + | 27.22covered by insurance. |
|---|
| 903 | + | 27.23 (h) Subject to any shorter period specified by the declaration or bylaws, if any installment |
|---|
| 904 | + | 27.24of an assessment becomes more than 60 days past due, then the association may, upon ten |
|---|
| 905 | + | 27.25days' written notice to the unit owner, declare the entire amount of the assessment |
|---|
| 906 | + | 27.26immediately due and payable in full, except that any portion of the assessment that represents |
|---|
| 907 | + | 27.27installments that are not due and payable without acceleration as of the date of reinstatement |
|---|
| 908 | + | 27.28must not be included in the amount that a unit owner must pay to reinstate under section |
|---|
| 909 | + | 27.29580.30 or chapter 581. |
|---|
| 910 | + | 27.30 (i) If common expense liabilities are reallocated for any purpose authorized by this |
|---|
| 911 | + | 27.31chapter, common expense assessments and any installment thereof not yet due shall be |
|---|
| 912 | + | 27.32recalculated in accordance with the reallocated common expense liabilities. |
|---|
| 913 | + | 27Article 2 Sec. 10. |
|---|
| 914 | + | REVISOR MS/AD 25-0391902/17/25 28.1 (j) An assessment against fewer than all of the units must be levied within three years |
|---|
| 915 | + | 28.2after the event or circumstances forming the basis for the assessment, or shall be barred. |
|---|
| 916 | + | 28.3 (k) An association must offer a unit owner a reasonable payment agreement and take |
|---|
| 917 | + | 28.4into consideration the financial circumstances of the unit owner. |
|---|
| 918 | + | 28.5 (k) (l) This section applies only to common interest communities created before August |
|---|
| 919 | + | 28.61, 2010. |
|---|
| 920 | + | 28.7 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 921 | + | 28.8 Sec. 11. Minnesota Statutes 2024, section 515B.3-1151, is amended to read: |
|---|
| 922 | + | 28.9 515B.3-1151 ASSESSMENTS FOR COMMON EXPENSES; CIC CREATED ON |
|---|
| 923 | + | 28.10OR AFTER AUGUST 1, 2010. |
|---|
| 924 | + | 28.11 (a) The association shall approve an annual budget of common expenses at or prior to |
|---|
| 925 | + | 28.12the conveyance of the first unit in the common interest community to a purchaser and |
|---|
| 926 | + | 28.13annually thereafter. The association shall provide each member of the homeowners |
|---|
| 927 | + | 28.14association with a copy of the proposed annual budget prior to the annual meeting at which |
|---|
| 928 | + | 28.15the budget is to be approved and allow member input on the budget prior to or during the |
|---|
| 929 | + | 28.16meeting. The annual budget shall include all customary and necessary operating expenses |
|---|
| 930 | + | 28.17and replacement reserves for the common interest community, consistent with this section |
|---|
| 931 | + | 28.18and section 515B.3-114. For purposes of replacement reserves under subsection (b), until |
|---|
| 932 | + | 28.19an annual budget has been approved, the reserves shall be paid based upon the budget |
|---|
| 933 | + | 28.20contained in the disclosure statement required by section 515B.4-102. The obligation of a |
|---|
| 934 | + | 28.21unit owner to pay common expenses shall be as follows: |
|---|
| 935 | + | 28.22 (1) If a common expense assessment has not been levied by the association, the declarant |
|---|
| 936 | + | 28.23shall pay all common expenses of the common interest community, including the payment |
|---|
| 937 | + | 28.24of the replacement reserve component of the common expenses for all units in compliance |
|---|
| 938 | + | 28.25with subsection (b). |
|---|
| 939 | + | 28.26 (2) If a common expense assessment has been levied by the association, all unit owners, |
|---|
| 940 | + | 28.27including the declarant, shall pay the assessments levied against their units, except as follows: |
|---|
| 941 | + | 28.28 (i) The declaration may provide for an alternate common expense plan whereby the |
|---|
| 942 | + | 28.29declarant's common expense liability, and the corresponding assessment lien against the |
|---|
| 943 | + | 28.30units owned by the declarant, is limited to: (A) paying when due, in compliance with |
|---|
| 944 | + | 28.31subsection (b), an amount equal to the full share of the replacement reserves allocated to |
|---|
| 945 | + | 28.32units owned by the declarant, as set forth in the association's annual budget approved as |
|---|
| 946 | + | 28.33provided in this subsection; and (B) paying when due all accrued expenses of the common |
|---|
| 947 | + | 28Article 2 Sec. 11. |
|---|
| 948 | + | REVISOR MS/AD 25-0391902/17/25 29.1interest community in excess of the aggregate assessments payable with respect to units |
|---|
| 949 | + | 29.2owned by persons other than a declarant; provided, that the alternate common expense plan |
|---|
| 950 | + | 29.3shall not affect a declarant's obligation to make up any operating deficit pursuant to item |
|---|
| 951 | + | 29.4(iv), and shall terminate upon the termination of any period of declarant control unless |
|---|
| 952 | + | 29.5terminated earlier pursuant to item (iii). |
|---|
| 953 | + | 29.6 (ii) The alternate common expense plan may be authorized only by including in the |
|---|
| 954 | + | 29.7declaration and the disclosure statement required by section 515B.4-102 provisions |
|---|
| 955 | + | 29.8authorizing and disclosing the alternate common expense plan as described in item (i), and |
|---|
| 956 | + | 29.9including in the disclosure statement either (A) a statement that the alternate common |
|---|
| 957 | + | 29.10expense plan will have no effect on the level of services or amenities anticipated by the |
|---|
| 958 | + | 29.11association's budget contained in the disclosure statement, or (B) a statement describing |
|---|
| 959 | + | 29.12how the services or amenities may be affected. |
|---|
| 960 | + | 29.13 (iii) A declarant shall give notice to the association of its intent to utilize the alternate |
|---|
| 961 | + | 29.14common expense plan and a commencement date after the date the notice is given. The |
|---|
| 962 | + | 29.15alternate common expense plan shall be valid only for periods after the notice is given. A |
|---|
| 963 | + | 29.16declarant may terminate its right to utilize the alternate common expense plan prior to the |
|---|
| 964 | + | 29.17termination of the period of declarant control only by giving notice to the association and |
|---|
| 965 | + | 29.18the unit owners at least 30 days prior to a selected termination date set forth in the notice. |
|---|
| 966 | + | 29.19 (iv) If a declarant utilizes an alternate common expense plan, that declarant shall cause |
|---|
| 967 | + | 29.20to be prepared and delivered to the association, at the declarant's expense, within 90 days |
|---|
| 968 | + | 29.21after the termination of the period of declarant control, an audited balance sheet and profit |
|---|
| 969 | + | 29.22and loss statement certified to the association and prepared by an accountant having the |
|---|
| 970 | + | 29.23qualifications set forth in section 515B.3-121(b). The audit shall be binding on the declarant |
|---|
| 971 | + | 29.24and the association. |
|---|
| 972 | + | 29.25 (v) If the audited profit and loss statement shows an accumulated operating deficit, the |
|---|
| 973 | + | 29.26declarant shall be obligated to make up the deficit within 15 days after delivery of the audit |
|---|
| 974 | + | 29.27to the association, and the association shall have a claim against the declarant for an amount |
|---|
| 975 | + | 29.28equal to the deficit until paid. A declarant who does not utilize an alternate common expense |
|---|
| 976 | + | 29.29plan is not liable to make up any operating deficit. If more than one declarant utilizes an |
|---|
| 977 | + | 29.30alternate common expense plan, all declarants who utilize the plan are jointly and severally |
|---|
| 978 | + | 29.31liable to the association for any operating deficit. |
|---|
| 979 | + | 29.32 (vi) The existence and amount, if any, of the operating deficit shall be determined using |
|---|
| 980 | + | 29.33the accrual method of accounting applied as of the date of termination of the period of |
|---|
| 981 | + | 29Article 2 Sec. 11. |
|---|
| 982 | + | REVISOR MS/AD 25-0391902/17/25 30.1declarant control, regardless of the accounting methodology previously used by the |
|---|
| 983 | + | 30.2association to maintain its accounts. |
|---|
| 984 | + | 30.3 (vii) Unless approved by a vote of the unit owners other than the declarant and its |
|---|
| 985 | + | 30.4affiliates, the operating deficit shall not be made up, prior to the election by the unit owners |
|---|
| 986 | + | 30.5of a board of directors pursuant to section 515B.3-103(d), through the use of a special |
|---|
| 987 | + | 30.6assessment described in subsection (c) or by assessments described in subsections (e), (f), |
|---|
| 988 | + | 30.7and (g). |
|---|
| 989 | + | 30.8 (viii) The use by a declarant of an alternate common expense plan shall not affect the |
|---|
| 990 | + | 30.9obligations of the declarant or the association as provided in the declaration, the bylaws, or |
|---|
| 991 | + | 30.10this chapter, or as represented in the disclosure statement required by section 515B.4-102, |
|---|
| 992 | + | 30.11except as to matters authorized by this chapter. |
|---|
| 993 | + | 30.12 (b) The replacement reserves required by section 515B.3-114 shall be paid to the |
|---|
| 994 | + | 30.13association by each unit owner for each unit owned by that unit owner in accordance with |
|---|
| 995 | + | 30.14the association's annual budget approved pursuant to subsection (a), regardless of whether |
|---|
| 996 | + | 30.15an annual assessment has been levied or whether the declarant has utilized an alternate |
|---|
| 997 | + | 30.16common expense plan under subsection (a)(2). Replacement reserves shall be paid with |
|---|
| 998 | + | 30.17respect to a unit commencing as of the later of (1) the date of creation of the common interest |
|---|
| 999 | + | 30.18community or (2) the date that the structure and exterior of the building containing the unit, |
|---|
| 1000 | + | 30.19or the structure and exterior of any building located within the unit boundaries, but excluding |
|---|
| 1001 | + | 30.20the interior finishing of the structure itself, are substantially completed. If the association |
|---|
| 1002 | + | 30.21has not approved an annual budget as of the commencement date for the payment of |
|---|
| 1003 | + | 30.22replacement reserves, then the reserves shall be paid based upon the budget contained in |
|---|
| 1004 | + | 30.23the disclosure statement required by section 515B.4-102. |
|---|
| 1005 | + | 30.24 (c) After an assessment has been levied by the association, assessments shall be levied |
|---|
| 1006 | + | 30.25at least annually, based upon an annual budget approved by the association. In addition to |
|---|
| 1007 | + | 30.26and not in lieu of annual assessments, an association may, if so provided in the declaration, |
|---|
| 1008 | + | 30.27levy special assessments against all units in the common interest community based upon |
|---|
| 1009 | + | 30.28the same formula required by the declaration for levying annual assessments. Special |
|---|
| 1010 | + | 30.29assessments may be levied only (1) to cover expenditures of an emergency nature, (2) to |
|---|
| 1011 | + | 30.30replenish underfunded replacement reserves, (3) to cover unbudgeted capital expenditures |
|---|
| 1012 | + | 30.31or operating expenses, or (4) to replace certain components of the common interest |
|---|
| 1013 | + | 30.32community described in section 515B.3-114(a), if such alternative method of funding is |
|---|
| 1014 | + | 30.33approved under section 515B.3-114(a)(5). The association may also levy assessments against |
|---|
| 1015 | + | 30.34fewer than all units as provided in subsections (e), (f), and (g). An assessment under |
|---|
| 1016 | + | 30Article 2 Sec. 11. |
|---|
| 1017 | + | REVISOR MS/AD 25-0391902/17/25 31.1subsection (e)(2) for replacement reserves is subject to the requirements of section |
|---|
| 1018 | + | 31.2515B.3-1141(a)(5). |
|---|
| 1019 | + | 31.3 (d) Except as modified by subsections (a), clauses paragraphs (1) and (2), (e), (f), and |
|---|
| 1020 | + | 31.4(g), all common expenses shall be assessed against all the units in accordance with the |
|---|
| 1021 | + | 31.5allocations established by the declaration pursuant to section 515B.2-108. |
|---|
| 1022 | + | 31.6 (e) Unless otherwise required by the declaration: |
|---|
| 1023 | + | 31.7 (1) any common expense associated with the maintenance, repair, or replacement of a |
|---|
| 1024 | + | 31.8limited common element shall be assessed against the units to which that limited common |
|---|
| 1025 | + | 31.9element is assigned, equally, or in any other proportion the declaration provides; |
|---|
| 1026 | + | 31.10 (2) any common expense or portion thereof benefiting fewer than all of the units may |
|---|
| 1027 | + | 31.11be assessed exclusively against the units benefited, equally, or in any other proportion the |
|---|
| 1028 | + | 31.12declaration provides; |
|---|
| 1029 | + | 31.13 (3) the costs of insurance may be assessed in proportion to risk or coverage, and the |
|---|
| 1030 | + | 31.14costs of utilities may be assessed in proportion to usage; |
|---|
| 1031 | + | 31.15 (4) subject to subsection (k) and section 515B.3-102(a)(11), reasonable attorney fees |
|---|
| 1032 | + | 31.16and costs incurred by the association in connection with (i) the collection of assessments, |
|---|
| 1033 | + | 31.17and (ii) the enforcement of this chapter, the articles, bylaws, declaration, or rules and |
|---|
| 1034 | + | 31.18regulations, against a unit owner, may be assessed against the unit owner's unit, subject to |
|---|
| 1035 | + | 31.19section 515B.3-116(h), provided that the attorney fees and costs for enforcement and |
|---|
| 1036 | + | 31.20collection may not exceed $1,500 and no fees or costs may be assessed if the association |
|---|
| 1037 | + | 31.21uses a collection agency as defined in section 332.31 if the fees of the collection agency are |
|---|
| 1038 | + | 31.22contingent on the amount collected; and |
|---|
| 1039 | + | 31.23 (5) subject to subsection (k), fees, charges, late charges, and fines, and interest may be |
|---|
| 1040 | + | 31.24assessed as provided in section 515B.3-116(a). |
|---|
| 1041 | + | 31.25 (f) Assessments levied under section 515B.3-116 to pay a judgment against the association |
|---|
| 1042 | + | 31.26may be levied only against the units in the common interest community at the time the |
|---|
| 1043 | + | 31.27judgment was entered, in proportion to their common expense liabilities. |
|---|
| 1044 | + | 31.28 (g) If any damage to the common elements or another unit is caused by the act or omission |
|---|
| 1045 | + | 31.29of any unit owner, or occupant of a unit, or their invitees, the association may assess the |
|---|
| 1046 | + | 31.30costs of repairing the damage exclusively against the unit owner's unit to the extent not |
|---|
| 1047 | + | 31.31covered by insurance. |
|---|
| 1048 | + | 31.32 (h) Subject to any shorter period specified by the declaration or bylaws, if any installment |
|---|
| 1049 | + | 31.33of an assessment becomes more than 60 days past due, then the association may, upon ten |
|---|
| 1050 | + | 31Article 2 Sec. 11. |
|---|
| 1051 | + | REVISOR MS/AD 25-0391902/17/25 32.1days' written notice to the unit owner, declare the entire amount of the assessment |
|---|
| 1052 | + | 32.2immediately due and payable in full, except that any portion of the assessment that represents |
|---|
| 1053 | + | 32.3installments that are not due and payable without acceleration as of the date of reinstatement |
|---|
| 1054 | + | 32.4must not be included in the amount that a unit owner must pay to reinstate under section |
|---|
| 1055 | + | 32.5580.30 or chapter 581. |
|---|
| 1056 | + | 32.6 (i) If common expense liabilities are reallocated for any purpose authorized by this |
|---|
| 1057 | + | 32.7chapter, common expense assessments and any installment thereof not yet due shall be |
|---|
| 1058 | + | 32.8recalculated in accordance with the reallocated common expense liabilities. |
|---|
| 1059 | + | 32.9 (j) An assessment against fewer than all of the units must be levied within three years |
|---|
| 1060 | + | 32.10after the event or circumstances forming the basis for the assessment, or shall be barred. |
|---|
| 1061 | + | 32.11 (k) An association must offer a unit owner a reasonable payment agreement and take |
|---|
| 1062 | + | 32.12into consideration the financial circumstances of the unit owner. |
|---|
| 1063 | + | 32.13 (k) (l) This section applies only to common interest communities created on or after |
|---|
| 1064 | + | 32.14August 1, 2010. |
|---|
| 1065 | + | 32.15 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1066 | + | 32.16Sec. 12. Minnesota Statutes 2024, section 515B.3-116, is amended to read: |
|---|
| 1067 | + | 32.17 515B.3-116 LIEN FOR ASSESSMENTS. |
|---|
| 1068 | + | 32.18 (a) The association has a lien on a unit for any assessment levied against that unit from |
|---|
| 1069 | + | 32.19the time the assessment becomes due. If an assessment is payable in installments, the full |
|---|
| 1070 | + | 32.20amount of the assessment is a lien from the time the first installment thereof becomes due. |
|---|
| 1071 | + | 32.21Unless the declaration otherwise provides, fees, charges, and late charges, fines and interest |
|---|
| 1072 | + | 32.22charges pursuant to section 515B.3-102(a)(10), (11) and (12) are liens, and are enforceable |
|---|
| 1073 | + | 32.23as assessments, under this section. Recording of the declaration constitutes record notice |
|---|
| 1074 | + | 32.24and perfection of any assessment lien under this section, and no further recording of any |
|---|
| 1075 | + | 32.25notice of or claim for the lien is required. |
|---|
| 1076 | + | 32.26 (b) Subject to subsection (c), a lien under this section is prior to all other liens and |
|---|
| 1077 | + | 32.27encumbrances on a unit except (i) liens and encumbrances recorded before the declaration |
|---|
| 1078 | + | 32.28and, in a cooperative, liens and encumbrances which the association creates, assumes, or |
|---|
| 1079 | + | 32.29takes subject to, (ii) any first mortgage encumbering the fee simple interest in the unit, or, |
|---|
| 1080 | + | 32.30in a cooperative, any first security interest encumbering only the unit owner's interest in the |
|---|
| 1081 | + | 32.31unit, (iii) liens for real estate taxes and other governmental assessments or charges against |
|---|
| 1082 | + | 32.32the unit, and (iv) a master association lien under section 515B.2-121(h). This subsection |
|---|
| 1083 | + | 32.33shall not affect the priority of mechanic's liens. |
|---|
| 1084 | + | 32Article 2 Sec. 12. |
|---|
| 1085 | + | REVISOR MS/AD 25-0391902/17/25 33.1 (c) If a first mortgage on a unit is foreclosed, the first mortgage was recorded after June |
|---|
| 1086 | + | 33.21, 1994, and no owner or person who acquires the owner's interest in the unit redeems |
|---|
| 1087 | + | 33.3pursuant to chapter 580, 581, or 582, the holder of the sheriff's certificate of sale from the |
|---|
| 1088 | + | 33.4foreclosure of the first mortgage or any person who acquires title to the unit by redemption |
|---|
| 1089 | + | 33.5as a junior creditor shall take title to the unit subject to a lien in favor of the association for |
|---|
| 1090 | + | 33.6unpaid assessments for common expenses levied pursuant to section 515B.3-115(a), (e)(1) |
|---|
| 1091 | + | 33.7to (3), (f), and (i) which became due, without acceleration, during the six months immediately |
|---|
| 1092 | + | 33.8preceding the end of the owner's period of redemption. The common expenses shall be |
|---|
| 1093 | + | 33.9based upon the association's then current annual budget, notwithstanding the use of an |
|---|
| 1094 | + | 33.10alternate common expense plan under section 515B.3-115(a)(2). If a first security interest |
|---|
| 1095 | + | 33.11encumbering a unit owner's interest in a cooperative unit which is personal property is |
|---|
| 1096 | + | 33.12foreclosed, the secured party or the purchaser at the sale shall take title to the unit subject |
|---|
| 1097 | + | 33.13to unpaid assessments for common expenses levied pursuant to section 515B.3-115(a), |
|---|
| 1098 | + | 33.14(e)(1) to (3), (f), and (i) which became due, without acceleration, during the six months |
|---|
| 1099 | + | 33.15immediately preceding the first day following either the disposition date pursuant to section |
|---|
| 1100 | + | 33.16336.9-610 or the date on which the obligation of the unit owner is discharged pursuant to |
|---|
| 1101 | + | 33.17section 336.9-622. |
|---|
| 1102 | + | 33.18 (d) Proceedings to enforce an assessment lien shall be instituted within three years after |
|---|
| 1103 | + | 33.19the last installment of the assessment becomes payable, or shall be barred. |
|---|
| 1104 | + | 33.20 (e) The unit owner of a unit at the time an assessment is due shall be personally liable |
|---|
| 1105 | + | 33.21to the association for payment of the assessment levied against the unit. If there are multiple |
|---|
| 1106 | + | 33.22owners of the unit, they shall be jointly and severally liable. |
|---|
| 1107 | + | 33.23 (f) This section does not prohibit actions to recover sums for which subsection (a) creates |
|---|
| 1108 | + | 33.24a lien nor prohibit an association from taking a deed in lieu of foreclosure. |
|---|
| 1109 | + | 33.25 (g) The association shall furnish to a unit owner or the owner's authorized agent upon |
|---|
| 1110 | + | 33.26written request of the unit owner or the authorized agent a statement setting forth the amount |
|---|
| 1111 | + | 33.27of unpaid assessments currently levied against the owner's unit. If the unit owner's interest |
|---|
| 1112 | + | 33.28is real estate, the statement shall be in recordable form. The statement shall be furnished |
|---|
| 1113 | + | 33.29within ten business days after receipt of the request and is binding on the association and |
|---|
| 1114 | + | 33.30every unit owner. |
|---|
| 1115 | + | 33.31 (h) The association's lien may be foreclosed as provided in this subsection. In no case |
|---|
| 1116 | + | 33.32may an association's lien be foreclosed for unpaid fines. Not including attorney fees, when |
|---|
| 1117 | + | 33.33unpaid fees, charges, and late charges are properly issued pursuant to section 515B.3-102, |
|---|
| 1118 | + | 33.34subsection (a), paragraphs (10), (11), and (12), an association may begin a foreclosure when |
|---|
| 1119 | + | 33Article 2 Sec. 12. |
|---|
| 1120 | + | REVISOR MS/AD 25-0391902/17/25 34.1the total amount owed is $5,000 or more and that amount has been outstanding for 180 days |
|---|
| 1121 | + | 34.2or more. |
|---|
| 1122 | + | 34.3 (1) In a condominium or planned community, the association's lien may be foreclosed |
|---|
| 1123 | + | 34.4in a like manner as a mortgage containing a power of sale pursuant to chapter 580, or by |
|---|
| 1124 | + | 34.5action pursuant to chapter 581. The association shall have a power of sale to foreclose the |
|---|
| 1125 | + | 34.6lien pursuant to chapter 580, except that any portion of the assessment that represents |
|---|
| 1126 | + | 34.7attorney fees or costs shall not be included in the amount a unit owner must pay to reinstate |
|---|
| 1127 | + | 34.8under section 580.30 or chapter 581. |
|---|
| 1128 | + | 34.9 (2) In a cooperative whose unit owners' interests are real estate, the association's lien |
|---|
| 1129 | + | 34.10shall be foreclosed in a like manner as a mortgage on real estate as provided in paragraph |
|---|
| 1130 | + | 34.11(1). |
|---|
| 1131 | + | 34.12 (3) In a cooperative whose unit owners' interests in the units are personal property, the |
|---|
| 1132 | + | 34.13association's lien shall be foreclosed in a like manner as a security interest under article 9 |
|---|
| 1133 | + | 34.14of chapter 336. In any disposition pursuant to section 336.9-610 or retention pursuant to |
|---|
| 1134 | + | 34.15sections 336.9-620 to 336.9-622, the rights of the parties shall be the same as those provided |
|---|
| 1135 | + | 34.16by law, except (i) notice of sale, disposition, or retention shall be served on the unit owner |
|---|
| 1136 | + | 34.1790 days prior to sale, disposition, or retention, (ii) the association shall be entitled to its |
|---|
| 1137 | + | 34.18reasonable costs and attorney fees not exceeding the amount provided by section 582.01, |
|---|
| 1138 | + | 34.19subdivision 1a, (iii) the amount of the association's lien shall be deemed to be adequate |
|---|
| 1139 | + | 34.20consideration for the unit subject to disposition or retention, notwithstanding the value of |
|---|
| 1140 | + | 34.21the unit, and (iv) the notice of sale, disposition, or retention shall contain the following |
|---|
| 1141 | + | 34.22statement in capital letters with the name of the association or secured party filled in: |
|---|
| 1142 | + | 34.23 "THIS IS TO INFORM YOU THAT BY THIS NOTICE (fill in name of association or |
|---|
| 1143 | + | 34.24secured party) HAS BEGUN PROCEEDINGS UNDER MINNESOTA STATUTES, |
|---|
| 1144 | + | 34.25CHAPTER 515B, TO FORECLOSE ON YOUR INTEREST IN YOUR UNIT FOR THE |
|---|
| 1145 | + | 34.26REASON SPECIFIED IN THIS NOTICE. YOUR INTEREST IN YOUR UNIT WILL |
|---|
| 1146 | + | 34.27TERMINATE 90 DAYS AFTER SERVICE OF THIS NOTICE ON YOU UNLESS |
|---|
| 1147 | + | 34.28BEFORE THEN: |
|---|
| 1148 | + | 34.29 (a) THE PERSON AUTHORIZED BY (fill in the name of association or secured party) |
|---|
| 1149 | + | 34.30AND DESCRIBED IN THIS NOTICE TO RECEIVE PAYMENTS RECEIVES FROM |
|---|
| 1150 | + | 34.31YOU: |
|---|
| 1151 | + | 34.32 (1) THE AMOUNT THIS NOTICE SAYS YOU OWE; PLUS |
|---|
| 1152 | + | 34.33 (2) THE COSTS INCURRED TO SERVE THIS NOTICE ON YOU; PLUS |
|---|
| 1153 | + | 34Article 2 Sec. 12. |
|---|
| 1154 | + | REVISOR MS/AD 25-0391902/17/25 35.1 (3) $500 TO APPLY TO ATTORNEY FEES ACTUALLY EXPENDED OR |
|---|
| 1155 | + | 35.2INCURRED; PLUS |
|---|
| 1156 | + | 35.3 (4) ANY ADDITIONAL AMOUNTS FOR YOUR UNIT BECOMING DUE TO (fill |
|---|
| 1157 | + | 35.4in name of association or secured party) AFTER THE DATE OF THIS NOTICE; OR |
|---|
| 1158 | + | 35.5 (b) YOU SECURE FROM A DISTRICT COURT AN ORDER THAT THE |
|---|
| 1159 | + | 35.6FORECLOSURE OF YOUR RIGHTS TO YOUR UNIT BE SUSPENDED UNTIL YOUR |
|---|
| 1160 | + | 35.7CLAIMS OR DEFENSES ARE FINALLY DISPOSED OF BY TRIAL, HEARING, OR |
|---|
| 1161 | + | 35.8SETTLEMENT. YOUR ACTION MUST SPECIFICALLY STATE THOSE FACTS AND |
|---|
| 1162 | + | 35.9GROUNDS THAT DEMONSTRATE YOUR CLAIMS OR DEFENSES. |
|---|
| 1163 | + | 35.10 IF YOU DO NOT DO ONE OR THE OTHER OF THE ABOVE THINGS WITHIN |
|---|
| 1164 | + | 35.11THE TIME PERIOD SPECIFIED IN THIS NOTICE, YOUR OWNERSHIP RIGHTS IN |
|---|
| 1165 | + | 35.12YOUR UNIT WILL TERMINATE AT THE END OF THE PERIOD, YOU WILL LOSE |
|---|
| 1166 | + | 35.13ALL THE MONEY YOU HAVE PAID FOR YOUR UNIT, YOU WILL LOSE YOUR |
|---|
| 1167 | + | 35.14RIGHT TO POSSESSION OF YOUR UNIT, YOU MAY LOSE YOUR RIGHT TO |
|---|
| 1168 | + | 35.15ASSERT ANY CLAIMS OR DEFENSES THAT YOU MIGHT HAVE, AND YOU WILL |
|---|
| 1169 | + | 35.16BE EVICTED. IF YOU HAVE ANY QUESTIONS ABOUT THIS NOTICE, CONTACT |
|---|
| 1170 | + | 35.17AN ATTORNEY IMMEDIATELY." |
|---|
| 1171 | + | 35.18 (4) In any foreclosure pursuant to chapter 580, 581, or 582, the rights of the parties shall |
|---|
| 1172 | + | 35.19be the same as those provided by law, except (i) the period of redemption for unit owners |
|---|
| 1173 | + | 35.20shall be six months from the date of sale or a lesser period authorized by law, (ii) in a |
|---|
| 1174 | + | 35.21foreclosure by advertisement under chapter 580, the foreclosing party shall be entitled to |
|---|
| 1175 | + | 35.22costs and disbursements of foreclosure and attorney fees authorized by the declaration or |
|---|
| 1176 | + | 35.23bylaws, notwithstanding the provisions of section 582.01, subdivisions 1 and 1a, as specified |
|---|
| 1177 | + | 35.24in section 582.01, subdivision 1, up to a maximum of $1,000, (iii) in a foreclosure by action |
|---|
| 1178 | + | 35.25under chapter 581, the foreclosing party shall be entitled to costs and disbursements of |
|---|
| 1179 | + | 35.26foreclosure and attorney fees as the court shall determine, and (iv) the amount of the |
|---|
| 1180 | + | 35.27association's lien shall be deemed to be adequate consideration for the unit subject to |
|---|
| 1181 | + | 35.28foreclosure, notwithstanding the value of the unit. |
|---|
| 1182 | + | 35.29 (i) If a holder of a sheriff's certificate of sale, prior to the expiration of the period of |
|---|
| 1183 | + | 35.30redemption, pays any past due or current assessments, or any other charges lienable as |
|---|
| 1184 | + | 35.31assessments, with respect to the unit described in the sheriff's certificate, then the amount |
|---|
| 1185 | + | 35.32paid shall be a part of the sum required to be paid to redeem under section 582.03. |
|---|
| 1186 | + | 35.33 (j) In a cooperative, if the unit owner fails to redeem before the expiration of the |
|---|
| 1187 | + | 35.34redemption period in a foreclosure of the association's assessment lien, the association may |
|---|
| 1188 | + | 35Article 2 Sec. 12. |
|---|
| 1189 | + | REVISOR MS/AD 25-0391902/17/25 36.1bring an action for eviction against the unit owner and any persons in possession of the unit, |
|---|
| 1190 | + | 36.2and in that case section 504B.291 shall not apply. |
|---|
| 1191 | + | 36.3 (k) An association may assign its lien rights in the same manner as any other secured |
|---|
| 1192 | + | 36.4party. |
|---|
| 1193 | + | 36.5 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1194 | + | 36.6 Sec. 13. [515B.3-122] REQUIREMENT TO MEET AND CONFER. |
|---|
| 1195 | + | 36.7 Subdivision 1.Enforcement action defined.For the purposes of this section, |
|---|
| 1196 | + | 36.8"enforcement action" means any attempt by an association, management company, or an |
|---|
| 1197 | + | 36.9attorney or other person on behalf of the association or management company, to collect a |
|---|
| 1198 | + | 36.10disputed assessment, fine, late fee, or other charge, or a civil action or proceeding, other |
|---|
| 1199 | + | 36.11than a cross-complaint, involving rights, duties, or liabilities under this chapter or any other |
|---|
| 1200 | + | 36.12law, or the governing documents of a common interest community or association, including |
|---|
| 1201 | + | 36.13the foreclosure of an association's lien pursuant to section 515B.3-116. |
|---|
| 1202 | + | 36.14 Subd. 2.Meet and confer process.Prior to an association taking any enforcement |
|---|
| 1203 | + | 36.15action, the association and the unit owner must engage in a meet and confer process in an |
|---|
| 1204 | + | 36.16effort to resolve any dispute between the association and the unit owner involving their |
|---|
| 1205 | + | 36.17respective rights, duties, or liabilities under this chapter or any other section of law, or under |
|---|
| 1206 | + | 36.18the governing documents of the common interest community or association. The association's |
|---|
| 1207 | + | 36.19board must designate a member of the board to meet and confer with the unit owner. The |
|---|
| 1208 | + | 36.20parties must meet as soon as practicable at a mutually convenient time and place. At the |
|---|
| 1209 | + | 36.21meeting, each party must be given reasonable time to present their positions and must confer |
|---|
| 1210 | + | 36.22in good faith to seek a resolution to the dispute. If the meet and confer process results in |
|---|
| 1211 | + | 36.23the resolution of the dispute, the resolution must be in writing and signed by both a board |
|---|
| 1212 | + | 36.24member and the unit owner. The signed agreement binds the parties and is judicially |
|---|
| 1213 | + | 36.25enforceable. A unit owner must not be charged any fees, including any attorney fees, to |
|---|
| 1214 | + | 36.26participate in the meet and confer process. |
|---|
| 1215 | + | 36.27 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1216 | + | 36.28Sec. 14. [515B.3-125] LEGAL FEES; NOTICE REQUIRED. |
|---|
| 1217 | + | 36.29 (a) Prior to referring a unit owner's inquiry to an attorney, the board must provide a |
|---|
| 1218 | + | 36.30notice to the unit owner with the following information: |
|---|
| 1219 | + | 36.31 (1) a statement that the board plans to refer the matter at issue to an attorney; |
|---|
| 1220 | + | 36.32 (2) the name of the person responsible for payment of any resulting legal fees; and |
|---|
| 1221 | + | 36Article 2 Sec. 14. |
|---|
| 1222 | + | REVISOR MS/AD 25-0391902/17/25 37.1 (3) an estimate of the legal fees the attorney may charge or has charged for similar work. |
|---|
| 1223 | + | 37.2 (b) The board must provide the notification under subsection (a) at no cost to the unit |
|---|
| 1224 | + | 37.3owner. |
|---|
| 1225 | + | 37.4 (c) The board must provide to a unit owner an itemized invoice for any legal fees charged |
|---|
| 1226 | + | 37.5to the unit owner detailing the attorney's rate, the time the attorney spent on the matter, the |
|---|
| 1227 | + | 37.6specific services the attorney provided, and the date or dates of service. |
|---|
| 1228 | + | 37.7 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1229 | + | 37.8 Sec. 15. Minnesota Statutes 2024, section 515B.4-102, is amended to read: |
|---|
| 1230 | + | 37.9 515B.4-102 DISCLOSURE STATEMENT; GENERAL PROVISIONS; CIC |
|---|
| 1231 | + | 37.10CREATED BEFORE AUGUST 1, 2010. |
|---|
| 1232 | + | 37.11 (a) A disclosure statement shall fully and accurately disclose: |
|---|
| 1233 | + | 37.12 (1) the name and, if available, the number of the common interest community; |
|---|
| 1234 | + | 37.13 (2) the name and principal address of the declarant; |
|---|
| 1235 | + | 37.14 (3) the number of units which the declarant has the right to include in the common |
|---|
| 1236 | + | 37.15interest community and a statement that the common interest community is either a |
|---|
| 1237 | + | 37.16condominium, cooperative, or planned community; |
|---|
| 1238 | + | 37.17 (4) a general description of the common interest community, including, at a minimum, |
|---|
| 1239 | + | 37.18(i) the number of buildings, (ii) the number of dwellings per building, (iii) the type of |
|---|
| 1240 | + | 37.19construction, (iv) whether the common interest community involves new construction or |
|---|
| 1241 | + | 37.20rehabilitation, (v) whether any building was wholly or partially occupied, for any purpose, |
|---|
| 1242 | + | 37.21before it was added to the common interest community and the nature of the occupancy, |
|---|
| 1243 | + | 37.22and (vi) a general description of any roads, trails, or utilities that are located on the common |
|---|
| 1244 | + | 37.23elements and that the association or a master association will be required to maintain; |
|---|
| 1245 | + | 37.24 (5) declarant's schedule of commencement and completion of construction of any |
|---|
| 1246 | + | 37.25buildings and other improvements that the declarant is obligated to build pursuant to section |
|---|
| 1247 | + | 37.26515B.4-117; |
|---|
| 1248 | + | 37.27 (6) any expenses or services, not reflected in the budget, that a declarant pays or provides, |
|---|
| 1249 | + | 37.28which may become a common expense; the projected common expense attributable to each |
|---|
| 1250 | + | 37.29of those expenses or services; and an explanation of declarant's limited assessment liability |
|---|
| 1251 | + | 37.30under section 515B.3-115(b); |
|---|
| 1252 | + | 37Article 2 Sec. 15. |
|---|
| 1253 | + | REVISOR MS/AD 25-0391902/17/25 38.1 (7) any initial or special fee due from the purchaser to the declarant or the association |
|---|
| 1254 | + | 38.2at closing, together with a description of the purpose and method of calculating the fee; |
|---|
| 1255 | + | 38.3 (8) identification of any liens, defects, or encumbrances which will continue to affect |
|---|
| 1256 | + | 38.4the title to a unit or to any real property owned by the association after the contemplated |
|---|
| 1257 | + | 38.5conveyance; |
|---|
| 1258 | + | 38.6 (9) a description of any financing offered or arranged by the declarant; |
|---|
| 1259 | + | 38.7 (10) a statement as to whether application has been made for any project approvals for |
|---|
| 1260 | + | 38.8the common interest community from the Federal National Mortgage Association (FNMA), |
|---|
| 1261 | + | 38.9Federal Home Loan Mortgage Corporation (FHLMC), Department of Housing and Urban |
|---|
| 1262 | + | 38.10Development (HUD) or Department of Veterans Affairs (VA), and which, if any, such final |
|---|
| 1263 | + | 38.11approvals have been received; |
|---|
| 1264 | + | 38.12 (11) the terms of any warranties provided by the declarant, including copies of sections |
|---|
| 1265 | + | 38.13515B.4-112 through 515B.4-115, and any other applicable statutory warranties, and a |
|---|
| 1266 | + | 38.14statement of any limitations on the enforcement of the applicable warranties or on damages; |
|---|
| 1267 | + | 38.15 (12) a statement that: (i) within ten days after the receipt of a disclosure statement, a |
|---|
| 1268 | + | 38.16purchaser may cancel any contract for the purchase of a unit from a declarant; provided, |
|---|
| 1269 | + | 38.17that the right to cancel terminates upon the purchaser's voluntary acceptance of a conveyance |
|---|
| 1270 | + | 38.18of the unit from the declarant or by the purchaser agreeing to modify or waive the right to |
|---|
| 1271 | + | 38.19cancel in the manner provided by section 515B.4-106(a); (ii) if a purchaser receives a |
|---|
| 1272 | + | 38.20disclosure statement more than ten days before signing a purchase agreement, the purchaser |
|---|
| 1273 | + | 38.21cannot cancel the purchase agreement; and (iii) if a declarant obligated to deliver a disclosure |
|---|
| 1274 | + | 38.22statement fails to deliver a disclosure statement which substantially complies with this |
|---|
| 1275 | + | 38.23chapter to a purchaser to whom a unit is conveyed, the declarant shall be liable to the |
|---|
| 1276 | + | 38.24purchaser as provided in section 515B.4-106(d); |
|---|
| 1277 | + | 38.25 (13) a statement disclosing to the extent of the declarant's or an affiliate of a declarant's |
|---|
| 1278 | + | 38.26actual knowledge, after reasonable inquiry, any unsatisfied judgments or lawsuits to which |
|---|
| 1279 | + | 38.27the association is a party, and the status of those lawsuits which are material to the common |
|---|
| 1280 | + | 38.28interest community or the unit being purchased; |
|---|
| 1281 | + | 38.29 (14) a statement (i) describing the conditions under which earnest money will be held |
|---|
| 1282 | + | 38.30in and disbursed from the escrow account, as set forth in section 515B.4-109, (ii) that the |
|---|
| 1283 | + | 38.31earnest money will be returned to the purchaser if the purchaser cancels the contract pursuant |
|---|
| 1284 | + | 38.32to section 515B.4-106, and (iii) setting forth the name and address of the escrow agent; |
|---|
| 1285 | + | 38Article 2 Sec. 15. |
|---|
| 1286 | + | REVISOR MS/AD 25-0391902/17/25 39.1 (15) a detailed description of the insurance coverage provided by the association for the |
|---|
| 1287 | + | 39.2benefit of unit owners, including a statement as to which, if any, of the items referred to in |
|---|
| 1288 | + | 39.3section 515B.3-113, subsection (b), are insured by the association; |
|---|
| 1289 | + | 39.4 (16) any current or expected fees or charges, other than assessments for common |
|---|
| 1290 | + | 39.5expenses, to be paid by unit owners for the use of the common elements or any other |
|---|
| 1291 | + | 39.6improvements or facilities; |
|---|
| 1292 | + | 39.7 (17) the financial arrangements, including any contingencies, which have been made to |
|---|
| 1293 | + | 39.8provide for completion of all improvements that the declarant is obligated to build pursuant |
|---|
| 1294 | + | 39.9to section 515B.4-118, or a statement that no such arrangements have been made; |
|---|
| 1295 | + | 39.10 (18) in a cooperative: (i) whether the unit owners will be entitled for federal and state |
|---|
| 1296 | + | 39.11tax purposes, to deduct payments made by the association for real estate taxes and interest |
|---|
| 1297 | + | 39.12paid to the holder of a security interest encumbering the cooperative; (ii) a statement as to |
|---|
| 1298 | + | 39.13the effect on the unit owners if the association fails to pay real estate taxes or payments due |
|---|
| 1299 | + | 39.14the holder of a security interest encumbering the cooperative; and (iii) the principal amount |
|---|
| 1300 | + | 39.15and a general description of the terms of any blanket mortgage, contract for deed, or other |
|---|
| 1301 | + | 39.16blanket security instrument encumbering the cooperative property; |
|---|
| 1302 | + | 39.17 (19) a statement: (i) that real estate taxes for the unit or any real property owned by the |
|---|
| 1303 | + | 39.18association are not delinquent or, if there are delinquent real estate taxes, describing the |
|---|
| 1304 | + | 39.19property for which the taxes are delinquent, stating the amount of the delinquent taxes, |
|---|
| 1305 | + | 39.20interest and penalties, and stating the years for which taxes are delinquent, and (ii) setting |
|---|
| 1306 | + | 39.21forth the amount of real estate taxes, including the amount of any special assessment certified |
|---|
| 1307 | + | 39.22for payment with the real estate taxes, due and payable with respect to the unit in the year |
|---|
| 1308 | + | 39.23in which the disclosure statement is given, if real estate taxes have been separately assessed |
|---|
| 1309 | + | 39.24against the unit; |
|---|
| 1310 | + | 39.25 (20) if the association or the purchaser of the unit will be a member of a master |
|---|
| 1311 | + | 39.26association, a statement to that effect, and all of the following information with respect to |
|---|
| 1312 | + | 39.27the master association: (i) a copy of the master declaration, the articles of incorporation, |
|---|
| 1313 | + | 39.28bylaws, and rules and regulations for the master association, together with any amendments |
|---|
| 1314 | + | 39.29thereto; (ii) the name, address and general description of the master association, including |
|---|
| 1315 | + | 39.30a general description of any other association, unit owners, or other persons which are or |
|---|
| 1316 | + | 39.31may become members; (iii) a description of any nonresidential use permitted on any property |
|---|
| 1317 | + | 39.32subject to the master association; (iv) a statement as to the estimated maximum number of |
|---|
| 1318 | + | 39.33associations, unit owners or other persons which may become members of the master |
|---|
| 1319 | + | 39.34association, and the degree and period of control of the master association by a declarant |
|---|
| 1320 | + | 39Article 2 Sec. 15. |
|---|
| 1321 | + | REVISOR MS/AD 25-0391902/17/25 40.1or other person; (v) a description of any facilities intended for the benefit of the members |
|---|
| 1322 | + | 40.2of the master association and not located on property owned or controlled by a member or |
|---|
| 1323 | + | 40.3the master association; (vi) the financial arrangements, including any contingencies, which |
|---|
| 1324 | + | 40.4have been made to provide for completion of the facilities referred to in subsection (v), or |
|---|
| 1325 | + | 40.5a statement that no arrangements have been made; (vii) any current balance sheet of the |
|---|
| 1326 | + | 40.6master association and a projected or current annual budget, as applicable, which budget |
|---|
| 1327 | + | 40.7shall include with respect to the master association those items in paragraph (23), clauses |
|---|
| 1328 | + | 40.8(i) through (iii), and the projected monthly common expense assessment for each type of |
|---|
| 1329 | + | 40.9unit, lot, or other parcel of real estate which is or is planned to be subject to assessment; |
|---|
| 1330 | + | 40.10(viii) a description of any expenses or services not reflected in the budget, paid for or |
|---|
| 1331 | + | 40.11provided by a declarant or a person executing the master declaration, which may become |
|---|
| 1332 | + | 40.12an expense of the master association in the future; (ix) a description of any powers delegated |
|---|
| 1333 | + | 40.13to and accepted by the master association pursuant to section 515B.2-121(f)(2); (x) |
|---|
| 1334 | + | 40.14identification of any liens, defects or encumbrances that will continue to affect title to |
|---|
| 1335 | + | 40.15property owned or operated by the master association for the benefit of its members; (xi) |
|---|
| 1336 | + | 40.16the terms of any warranties provided by any person for construction of facilities in which |
|---|
| 1337 | + | 40.17the members of the master association have or may have an interest, and any known defects |
|---|
| 1338 | + | 40.18in the facilities which would violate the standards described in section 515B.4-112(b); (xii) |
|---|
| 1339 | + | 40.19a statement disclosing, after inquiry of the master association, any unsatisfied judgments |
|---|
| 1340 | + | 40.20or lawsuits to which the master association is a party, and the status of those lawsuits which |
|---|
| 1341 | + | 40.21are material to the master association; (xiii) a description of any insurance coverage provided |
|---|
| 1342 | + | 40.22for the benefit of its members by the master association; and (xiv) any current or expected |
|---|
| 1343 | + | 40.23fees or charges, other than assessments by the master association, to be paid by members |
|---|
| 1344 | + | 40.24of the master association for the use of any facilities intended for the benefit of the members; |
|---|
| 1345 | + | 40.25 (21) a statement as to whether the unit will be substantially completed at the time of |
|---|
| 1346 | + | 40.26conveyance to a purchaser, and if not substantially completed, who is responsible to complete |
|---|
| 1347 | + | 40.27and pay for the construction of the unit; |
|---|
| 1348 | + | 40.28 (22) a plain-language explanation of the declaration, articles of incorporation, and current |
|---|
| 1349 | + | 40.29bylaws, as well as a copy of the declaration and any amendments thereto (exclusive of the |
|---|
| 1350 | + | 40.30CIC plat); any other recorded covenants, conditions, restrictions, or reservations affecting |
|---|
| 1351 | + | 40.31the common interest community; the articles of incorporation, bylaws and any rules or |
|---|
| 1352 | + | 40.32regulations of the association; any agreement excluding or modifying any implied warranties; |
|---|
| 1353 | + | 40.33any agreement reducing the statute of limitations for the enforcement of warranties; any |
|---|
| 1354 | + | 40.34contracts or leases to be signed by purchaser at closing; and a brief narrative description of |
|---|
| 1355 | + | 40.35any (i) contracts or leases that are or may be subject to cancellation by the association under |
|---|
| 1356 | + | 40Article 2 Sec. 15. |
|---|
| 1357 | + | REVISOR MS/AD 25-0391902/17/25 41.1section 515B.3-105 and (ii) any material agreements entered into between the declarant and |
|---|
| 1358 | + | 41.2a governmental entity that affect the common interest community; and |
|---|
| 1359 | + | 41.3 (23) a balance sheet for the association, current within 90 days; a projected annual budget |
|---|
| 1360 | + | 41.4for the association; and a statement identifying the party responsible for the preparation of |
|---|
| 1361 | + | 41.5the budget. The budget shall assume that all units intended to be included in the common |
|---|
| 1362 | + | 41.6interest community, based upon the declarant's good faith estimate, have been subjected to |
|---|
| 1363 | + | 41.7the declaration; provided, that additional budget portrayals based upon a lesser number of |
|---|
| 1364 | + | 41.8units are permitted. The budget shall include, without limitation: (i) a statement of the |
|---|
| 1365 | + | 41.9amount included in the budget as a reserve for replacement; (ii) a statement of any other |
|---|
| 1366 | + | 41.10reserves; (iii) the projected common expense for each category of expenditures for the |
|---|
| 1367 | + | 41.11association; (iv) the projected monthly common expense assessment for each type of unit; |
|---|
| 1368 | + | 41.12and (v) a footnote or other reference to those components of the common interest community |
|---|
| 1369 | + | 41.13the maintenance, repair, or replacement of which the budget assumes will be funded by |
|---|
| 1370 | + | 41.14assessments under section 515B.3-115(e), rather than by assessments included in the |
|---|
| 1371 | + | 41.15association's annual budget, and a statement referencing section 515B.3-115(e)(1) or (2), |
|---|
| 1372 | + | 41.16as the source of funding. If, based upon the association's then current budget, the monthly |
|---|
| 1373 | + | 41.17common expense assessment for the unit at the time of conveyance to the purchaser is |
|---|
| 1374 | + | 41.18anticipated to exceed the monthly assessment stated in the budget, a statement to such effect |
|---|
| 1375 | + | 41.19shall be included; |
|---|
| 1376 | + | 41.20 (24) a copy of any fact sheet or other publication by the attorney general and the |
|---|
| 1377 | + | 41.21Community Association Institute that describes, in plain language, common interest |
|---|
| 1378 | + | 41.22communities and homeowner associations and explains the rights and responsibilities of |
|---|
| 1379 | + | 41.23unit owners and associations; and |
|---|
| 1380 | + | 41.24 (25) the schedules of fines required under section 515B.3-102, subsections (a), paragraph |
|---|
| 1381 | + | 41.25(10), and (c). |
|---|
| 1382 | + | 41.26 (b) A declarant shall promptly amend the disclosure statement to reflect any material |
|---|
| 1383 | + | 41.27change in the information required by this chapter. |
|---|
| 1384 | + | 41.28 (c) The master association, within ten days after a request by a declarant, a holder of |
|---|
| 1385 | + | 41.29declarant rights, or a buyer referred to in section 515B.4-101(e), or the authorized |
|---|
| 1386 | + | 41.30representative of any of them, shall furnish the information required to be provided by |
|---|
| 1387 | + | 41.31subsection (a)(20). A declarant or other person who provides information pursuant to |
|---|
| 1388 | + | 41.32subsection (a)(20) is not liable to the buyer for any erroneous information if the declarant |
|---|
| 1389 | + | 41.33or other person: (i) is not an affiliate of or related in any way to a person authorized to |
|---|
| 1390 | + | 41Article 2 Sec. 15. |
|---|
| 1391 | + | REVISOR MS/AD 25-0391902/17/25 42.1appoint the master association board pursuant to section 515B.2-121(c)(3), and (ii) has no |
|---|
| 1392 | + | 42.2actual knowledge that the information is incorrect. |
|---|
| 1393 | + | 42.3 (d) This section applies only to common interest communities created before August 1, |
|---|
| 1394 | + | 42.42010. |
|---|
| 1395 | + | 42.5 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1396 | + | 42.6 Sec. 16. Minnesota Statutes 2024, section 515B.4-1021, is amended to read: |
|---|
| 1397 | + | 42.7 515B.4-1021 DISCLOSURE STATEMENT; GENERAL PROVISIONS; CIC |
|---|
| 1398 | + | 42.8CREATED ON OR AFTER AUGUST 1, 2010. |
|---|
| 1399 | + | 42.9 (a) A disclosure statement shall fully and accurately disclose: |
|---|
| 1400 | + | 42.10 (1) the name and, if available, the number of the common interest community; |
|---|
| 1401 | + | 42.11 (2) the name and principal address of each declarant holding any special declarant rights; |
|---|
| 1402 | + | 42.12a description of the special declarant rights held by each declarant; a description of the units |
|---|
| 1403 | + | 42.13or additional real estate to which the respective special declarant rights apply; and a copy |
|---|
| 1404 | + | 42.14of any recorded transfer of special declarant rights pursuant to section 515B.3-104(a), or |
|---|
| 1405 | + | 42.15any instrument recorded pursuant to section 515B.3-104(b), (g), or (h); |
|---|
| 1406 | + | 42.16 (3) the total number of units which all declarants have the right to include in the common |
|---|
| 1407 | + | 42.17interest community and a statement that the common interest community is either a |
|---|
| 1408 | + | 42.18condominium, cooperative, or planned community; |
|---|
| 1409 | + | 42.19 (4) a general description of the common interest community, including, at a minimum, |
|---|
| 1410 | + | 42.20(i) the number of buildings, (ii) the number of dwellings per building, (iii) the type of |
|---|
| 1411 | + | 42.21construction, (iv) whether the common interest community involves new construction or |
|---|
| 1412 | + | 42.22rehabilitation, (v) whether any building was wholly or partially occupied, for any purpose, |
|---|
| 1413 | + | 42.23before it was added to the common interest community, and the nature of the occupancy, |
|---|
| 1414 | + | 42.24(vi) a general description of any roads, trails, or utilities that are located on the common |
|---|
| 1415 | + | 42.25elements and that the association or master association will be required to maintain, (vii) a |
|---|
| 1416 | + | 42.26description of any declarant licensing rights under section 515B.2-109(e), and (viii) the |
|---|
| 1417 | + | 42.27initial maintenance plan, initial maintenance schedule, and maintenance budget under section |
|---|
| 1418 | + | 42.28515B.3-107(b). The initial maintenance plan prepared by the declarant must be based on |
|---|
| 1419 | + | 42.29the best available information listing all building elements to which the plan will apply and |
|---|
| 1420 | + | 42.30the generally accepted standards of maintenance on which the plan is based. The initial plan |
|---|
| 1421 | + | 42.31must be dated and signed by the declarant and be fully funded by the initial budget provided |
|---|
| 1422 | + | 42.32by the declarant; |
|---|
| 1423 | + | 42Article 2 Sec. 16. |
|---|
| 1424 | + | REVISOR MS/AD 25-0391902/17/25 43.1 (5) declarant's schedule of commencement and completion of construction of any |
|---|
| 1425 | + | 43.2buildings and other improvements that the declarant is obligated to build pursuant to section |
|---|
| 1426 | + | 43.3515B.4-117; |
|---|
| 1427 | + | 43.4 (6) any expenses or services, not reflected in the budget, that the declarant pays or |
|---|
| 1428 | + | 43.5provides, which may become a common expense; the projected common expense attributable |
|---|
| 1429 | + | 43.6to each of those expenses or services; a description of any alternate common expense plan |
|---|
| 1430 | + | 43.7under section 515B.3-115(a)(2)(i); and, if the declaration provides for an alternate common |
|---|
| 1431 | + | 43.8expense plan, either (i) a statement that the alternate common expense plan will have no |
|---|
| 1432 | + | 43.9effect on the level of services or amenities anticipated by the association's budget or disclosed |
|---|
| 1433 | + | 43.10in the disclosure statement, or (ii) a statement describing how the services or amenities may |
|---|
| 1434 | + | 43.11be affected; |
|---|
| 1435 | + | 43.12 (7) any initial or special fee due from the purchaser to the declarant or the association |
|---|
| 1436 | + | 43.13at closing, together with a description of the purpose and method of calculating the fee; |
|---|
| 1437 | + | 43.14 (8) identification of any liens, defects, or encumbrances which will continue to affect |
|---|
| 1438 | + | 43.15the title to a unit or to any real property owned by the association after the contemplated |
|---|
| 1439 | + | 43.16conveyance; |
|---|
| 1440 | + | 43.17 (9) a description of any financing offered or arranged by the declarant; |
|---|
| 1441 | + | 43.18 (10) a statement as to whether application has been made for any project approvals for |
|---|
| 1442 | + | 43.19the common interest community from the Federal National Mortgage Association (FNMA), |
|---|
| 1443 | + | 43.20Federal Home Loan Mortgage Corporation (FHLMC), Department of Housing and Urban |
|---|
| 1444 | + | 43.21Development (HUD), or Department of Veterans Affairs (VA), and which, if any, such |
|---|
| 1445 | + | 43.22final approvals have been received; |
|---|
| 1446 | + | 43.23 (11) the terms of any warranties provided by the declarant, including copies of sections |
|---|
| 1447 | + | 43.24515B.4-112 to 515B.4-115, and any other applicable statutory warranties, and a statement |
|---|
| 1448 | + | 43.25of any limitations on the enforcement of the applicable warranties or on damages; |
|---|
| 1449 | + | 43.26 (12) a statement that: |
|---|
| 1450 | + | 43.27 (i) within ten days after the receipt of a disclosure statement, a purchaser may cancel |
|---|
| 1451 | + | 43.28any contract for the purchase of a unit from a declarant; provided, that the right to cancel |
|---|
| 1452 | + | 43.29terminates upon the purchaser's voluntary acceptance of a conveyance of the unit from the |
|---|
| 1453 | + | 43.30declarant or by the purchaser agreeing to modify or waive the right to cancel in the manner |
|---|
| 1454 | + | 43.31provided by section 515B.4-106(a); |
|---|
| 1455 | + | 43.32 (ii) if a purchaser receives a disclosure statement more than ten days before signing a |
|---|
| 1456 | + | 43.33purchase agreement, the purchaser cannot cancel the purchase agreement; and |
|---|
| 1457 | + | 43Article 2 Sec. 16. |
|---|
| 1458 | + | REVISOR MS/AD 25-0391902/17/25 44.1 (iii) if a declarant obligated to deliver a disclosure statement fails to deliver a disclosure |
|---|
| 1459 | + | 44.2statement which substantially complies with this chapter to a purchaser to whom a unit is |
|---|
| 1460 | + | 44.3conveyed, the declarant shall be liable to the purchaser as provided in section 515B.4-106(d); |
|---|
| 1461 | + | 44.4 (13) a statement disclosing to the extent of the declarant's or an affiliate of a declarant's |
|---|
| 1462 | + | 44.5actual knowledge, after reasonable inquiry, any unsatisfied judgments or lawsuits to which |
|---|
| 1463 | + | 44.6the association is a party, and the status of those lawsuits which are material to the common |
|---|
| 1464 | + | 44.7interest community or the unit being purchased; |
|---|
| 1465 | + | 44.8 (14) a statement (i) describing the conditions under which earnest money will be held |
|---|
| 1466 | + | 44.9in and disbursed from the escrow account, as set forth in section 515B.4-109, (ii) that the |
|---|
| 1467 | + | 44.10earnest money will be returned to the purchaser if the purchaser cancels the contract pursuant |
|---|
| 1468 | + | 44.11to section 515B.4-106, and (iii) setting forth the name and address of the escrow agent; |
|---|
| 1469 | + | 44.12 (15) a detailed description of the insurance coverage provided by the association for the |
|---|
| 1470 | + | 44.13benefit of unit owners, including a statement as to which, if any, of the items referred to in |
|---|
| 1471 | + | 44.14section 515B.3-113(b), are insured by the association; |
|---|
| 1472 | + | 44.15 (16) any current or expected fees or charges, other than assessments for common |
|---|
| 1473 | + | 44.16expenses, to be paid by unit owners for the use of the common elements or any other |
|---|
| 1474 | + | 44.17improvements or facilities; |
|---|
| 1475 | + | 44.18 (17) the financial arrangements, including any contingencies, which have been made to |
|---|
| 1476 | + | 44.19provide for completion of all improvements that the declarant is obligated to build pursuant |
|---|
| 1477 | + | 44.20to section 515B.4-118, or a statement that no such arrangements have been made; |
|---|
| 1478 | + | 44.21 (18) in a cooperative: |
|---|
| 1479 | + | 44.22 (i) whether the unit owners will be entitled, for federal and state tax purposes, to deduct |
|---|
| 1480 | + | 44.23payments made by the association for real estate taxes and interest paid to the holder of a |
|---|
| 1481 | + | 44.24security interest encumbering the cooperative; |
|---|
| 1482 | + | 44.25 (ii) a statement as to the effect on the unit owners if the association fails to pay real estate |
|---|
| 1483 | + | 44.26taxes or payments due the holder of a security interest encumbering the cooperative; and |
|---|
| 1484 | + | 44.27 (iii) the principal amount and a general description of the terms of any blanket mortgage, |
|---|
| 1485 | + | 44.28contract for deed, or other blanket security instrument encumbering the cooperative property; |
|---|
| 1486 | + | 44.29 (19) a statement: |
|---|
| 1487 | + | 44.30 (i) that real estate taxes for the unit or any real property owned by the association are |
|---|
| 1488 | + | 44.31not delinquent or, if there are delinquent real estate taxes, describing the property for which |
|---|
| 1489 | + | 44Article 2 Sec. 16. |
|---|
| 1490 | + | REVISOR MS/AD 25-0391902/17/25 45.1the taxes are delinquent, stating the amount of the delinquent taxes, interest, and penalties, |
|---|
| 1491 | + | 45.2and stating the years for which taxes are delinquent; and |
|---|
| 1492 | + | 45.3 (ii) setting forth the amount of real estate taxes, including the amount of any special |
|---|
| 1493 | + | 45.4assessment certified for payment with the real estate taxes, due and payable with respect to |
|---|
| 1494 | + | 45.5the unit in the year in which the disclosure statement is given, if real estate taxes have been |
|---|
| 1495 | + | 45.6separately assessed against the unit; |
|---|
| 1496 | + | 45.7 (20) if the unit or other parcel of real estate being purchased is or may be subject to a |
|---|
| 1497 | + | 45.8master declaration at the time of the conveyance from the declarant to the purchaser, a |
|---|
| 1498 | + | 45.9statement to that effect, and all of the following information with respect to the master |
|---|
| 1499 | + | 45.10association: |
|---|
| 1500 | + | 45.11 (i) copies of the following documents (which may be in proposed form if the master |
|---|
| 1501 | + | 45.12declaration has not been recorded): the master declaration, the articles of incorporation, |
|---|
| 1502 | + | 45.13bylaws, and rules and regulations for the master association, together with any amendments |
|---|
| 1503 | + | 45.14thereto; |
|---|
| 1504 | + | 45.15 (ii) the name and address of the master developer, and the name, address, and general |
|---|
| 1505 | + | 45.16description of the master association, including a general description of any other association, |
|---|
| 1506 | + | 45.17unit owners, or other persons which are or may become members; |
|---|
| 1507 | + | 45.18 (iii) a description of any nonresidential use permitted on any property subject to the |
|---|
| 1508 | + | 45.19master declaration; |
|---|
| 1509 | + | 45.20 (iv) a statement as to the estimated maximum number of associations, unit owners, or |
|---|
| 1510 | + | 45.21other persons which may become members of the master association, and a description of |
|---|
| 1511 | + | 45.22any period of control of the master association and rights to appoint master association |
|---|
| 1512 | + | 45.23directors by a master developer or other person pursuant to section 515B.2-121(c); |
|---|
| 1513 | + | 45.24 (v) a description of any facilities intended for the benefit of the members of the master |
|---|
| 1514 | + | 45.25association and not located on property owned or controlled by a member of the master |
|---|
| 1515 | + | 45.26association; |
|---|
| 1516 | + | 45.27 (vi) the financial arrangements, including any contingencies, which have been made to |
|---|
| 1517 | + | 45.28provide for completion of the facilities referred to in subsection (v), or a statement that no |
|---|
| 1518 | + | 45.29arrangements have been made; |
|---|
| 1519 | + | 45.30 (vii) any current balance sheet of the master association and a projected or current annual |
|---|
| 1520 | + | 45.31budget, as applicable, which budget shall include with respect to the master association |
|---|
| 1521 | + | 45.32those items in paragraph (23), clauses (i) through (iii), and the projected monthly or other |
|---|
| 1522 | + | 45Article 2 Sec. 16. |
|---|
| 1523 | + | REVISOR MS/AD 25-0391902/17/25 46.1periodic common expense assessment payment for each type of unit, lot, or other parcel of |
|---|
| 1524 | + | 46.2real estate which is or is planned to be subject to assessment; |
|---|
| 1525 | + | 46.3 (viii) a description of any expenses or services not reflected in the budget, paid for or |
|---|
| 1526 | + | 46.4provided by a master developer or another person executing the master declaration, which |
|---|
| 1527 | + | 46.5may become an expense of the master association in the future; |
|---|
| 1528 | + | 46.6 (ix) a description of any powers delegated to and accepted by the master association |
|---|
| 1529 | + | 46.7pursuant to section 515B.2-121(e)(2); |
|---|
| 1530 | + | 46.8 (x) identification of any liens, defects, or encumbrances that will continue to affect title |
|---|
| 1531 | + | 46.9to property owned or operated by the master association for the benefit of its members; |
|---|
| 1532 | + | 46.10 (xi) the terms of any warranties provided by any person for construction of facilities in |
|---|
| 1533 | + | 46.11which the members of the master association have or may have an interest, and any known |
|---|
| 1534 | + | 46.12defects in the facilities which would violate the standards described in section |
|---|
| 1535 | + | 46.13515B.4-113(b)(2); |
|---|
| 1536 | + | 46.14 (xii) a statement disclosing, after inquiry of the master association, any unsatisfied |
|---|
| 1537 | + | 46.15judgments or lawsuits to which the master association is a party, and the status of those |
|---|
| 1538 | + | 46.16lawsuits which are material to the master association; |
|---|
| 1539 | + | 46.17 (xiii) a description of any insurance coverage provided for the benefit of its members |
|---|
| 1540 | + | 46.18by the master association; and |
|---|
| 1541 | + | 46.19 (xiv) any current or expected fees or charges, other than assessments by the master |
|---|
| 1542 | + | 46.20association, to be paid by members of the master association for the use of any facilities |
|---|
| 1543 | + | 46.21intended for the benefit of the members; |
|---|
| 1544 | + | 46.22 (21) a statement as to whether the unit will be substantially completed at the time of |
|---|
| 1545 | + | 46.23conveyance to a purchaser, and, if not substantially completed, who is responsible to complete |
|---|
| 1546 | + | 46.24and pay for the construction of the unit; |
|---|
| 1547 | + | 46.25 (22) a plain-language explanation of the declaration, articles of incorporation, and current |
|---|
| 1548 | + | 46.26bylaws, as well as copies of the following documents (which may be in proposed form if |
|---|
| 1549 | + | 46.27the declaration has not been recorded): the declaration and any supplemental declaration, |
|---|
| 1550 | + | 46.28and any amendments thereto (exclusive of the CIC plat); any other recorded covenants, |
|---|
| 1551 | + | 46.29conditions, restrictions, and reservations affecting the common interest community; the |
|---|
| 1552 | + | 46.30articles of incorporation, bylaws, and any rules or regulations of the association; the names |
|---|
| 1553 | + | 46.31of the current members of the association's board of directors; any agreement excluding or |
|---|
| 1554 | + | 46.32modifying any implied warranties; any agreement reducing the statute of limitations for the |
|---|
| 1555 | + | 46.33enforcement of warranties; any contracts or leases to be signed by the purchaser at closing; |
|---|
| 1556 | + | 46Article 2 Sec. 16. |
|---|
| 1557 | + | REVISOR MS/AD 25-0391902/17/25 47.1and a description of any material contracts, leases, or other agreements affecting the common |
|---|
| 1558 | + | 47.2interest community; and |
|---|
| 1559 | + | 47.3 (23) a balance sheet for the association, following the creation of the association, current |
|---|
| 1560 | + | 47.4within 90 days; a projected annual budget for the association; and a statement identifying |
|---|
| 1561 | + | 47.5the party responsible for the preparation of the budget. The budget shall assume that all |
|---|
| 1562 | + | 47.6units intended to be included in the common interest community, based upon the declarant's |
|---|
| 1563 | + | 47.7good faith estimate, have been subjected to the declaration; provided, that additional budget |
|---|
| 1564 | + | 47.8portrayals based upon a lesser number of units are permitted. The budget shall include, |
|---|
| 1565 | + | 47.9without limitation: |
|---|
| 1566 | + | 47.10 (i) a statement of the amount included in the budget as a reserve for replacement, the |
|---|
| 1567 | + | 47.11components of the common interest community for which the reserves are budgeted, and |
|---|
| 1568 | + | 47.12the amounts of the reserves, if any, that are allocated for the replacement of each of those |
|---|
| 1569 | + | 47.13components; |
|---|
| 1570 | + | 47.14 (ii) a statement of any other reserves; |
|---|
| 1571 | + | 47.15 (iii) the projected common expense for each category of expenditures for the association; |
|---|
| 1572 | + | 47.16 (iv) the projected monthly common expense assessment for each type of unit; |
|---|
| 1573 | + | 47.17 (v) a statement as to the components of the common interest community whose |
|---|
| 1574 | + | 47.18replacement will be funded by assessments under section 515B.3-115(c) or (e), rather than |
|---|
| 1575 | + | 47.19by replacement reserves as approved pursuant to section 515B.3-114(a). If, based upon the |
|---|
| 1576 | + | 47.20association's then-current budget, the monthly common expense assessment for the unit at |
|---|
| 1577 | + | 47.21the time of conveyance to the purchaser is anticipated to exceed the monthly assessment |
|---|
| 1578 | + | 47.22stated in the budget, a statement to such effect shall be included; |
|---|
| 1579 | + | 47.23 (24) a copy of any fact sheet or other publication by the attorney general and the |
|---|
| 1580 | + | 47.24Community Association Institute that describes, in plain language, common interest |
|---|
| 1581 | + | 47.25communities and homeowner associations and explains the rights and responsibilities of |
|---|
| 1582 | + | 47.26unit owners and associations; and |
|---|
| 1583 | + | 47.27 (25) the schedules of fines required under section 515B.3-102, subsections (a), paragraph |
|---|
| 1584 | + | 47.28(10), and (c). |
|---|
| 1585 | + | 47.29 (b) A declarant shall promptly amend the disclosure statement to reflect any material |
|---|
| 1586 | + | 47.30change in the information required by this chapter. |
|---|
| 1587 | + | 47.31 (c) The master association, within ten days after a request by a declarant, a holder of |
|---|
| 1588 | + | 47.32declarant rights, or a buyer referred to in section 515B.4-101(e), or the authorized |
|---|
| 1589 | + | 47.33representative of any of them, shall furnish the information required to be provided by |
|---|
| 1590 | + | 47Article 2 Sec. 16. |
|---|
| 1591 | + | REVISOR MS/AD 25-0391902/17/25 48.1subsection (a)(20). A declarant or other person who provides information pursuant to |
|---|
| 1592 | + | 48.2subsection (a)(20), is not liable to the buyer for any erroneous information if the declarant |
|---|
| 1593 | + | 48.3or other person: (i) is not an affiliate of or related in any way to a person authorized to |
|---|
| 1594 | + | 48.4appoint the master association board pursuant to section 515B.2-121(c)(3), and (ii) has no |
|---|
| 1595 | + | 48.5actual knowledge that the information is incorrect. |
|---|
| 1596 | + | 48.6 (d) This section applies only to common interest communities created on or after August |
|---|
| 1597 | + | 48.71, 2010. |
|---|
| 1598 | + | 48.8 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1599 | + | 48.9 Sec. 17. Minnesota Statutes 2024, section 515B.4-107, is amended to read: |
|---|
| 1600 | + | 48.10 515B.4-107 RESALE OF UNITS. |
|---|
| 1601 | + | 48.11 (a) In the event of a resale of a unit by a unit owner other than a declarant, unless exempt |
|---|
| 1602 | + | 48.12under section 515B.4-101(c), the unit owner shall furnish to a purchaser, before execution |
|---|
| 1603 | + | 48.13of any purchase agreement for a unit or otherwise before conveyance, the following |
|---|
| 1604 | + | 48.14documents relating to the association or to the master association, if applicable: |
|---|
| 1605 | + | 48.15 (1) a plain-language explanation of the declaration, articles of incorporation, and current |
|---|
| 1606 | + | 48.16bylaws prepared by the board of directors, as well as copies of the declaration (other than |
|---|
| 1607 | + | 48.17any CIC plat), the articles of incorporation and bylaws, any rules and regulations, and any |
|---|
| 1608 | + | 48.18amendments or supplemental declarations; |
|---|
| 1609 | + | 48.19 (2) copies of the master declaration, articles of incorporation, bylaws, and rules and |
|---|
| 1610 | + | 48.20regulations, if the common interest community is subject to a master declaration; and |
|---|
| 1611 | + | 48.21 (3) a resale disclosure certificate from the association dated not more than 90 days prior |
|---|
| 1612 | + | 48.22to the date of the purchase agreement or the date of conveyance, whichever is earlier, |
|---|
| 1613 | + | 48.23containing the information set forth in subsection (b). |
|---|
| 1614 | + | 48.24 (b) The resale disclosure certificate must be in substantially the following form: |
|---|
| 1615 | + | 48.25 COMMON INTEREST COMMUNITY |
|---|
| 1616 | + | 48.26 RESALE DISCLOSURE CERTIFICATE |
|---|
| 1617 | + | 48.27Name of Common Interest Community:................................................................................ |
|---|
| 1618 | + | 48.28Name of Association:............................................................................................................. |
|---|
| 1619 | + | 48.29Address of Association:......................................................................................................... |
|---|
| 1620 | + | 48.30Unit Number(s) (include principal unit and any garage, storage, or other auxiliary units): |
|---|
| 1621 | + | 48.31 Common elements licensed under Minnesota Statutes, section 515B.2-109(e): |
|---|
| 1622 | + | 48Article 2 Sec. 17. |
|---|
| 1623 | + | REVISOR MS/AD 25-0391902/17/25 49.1................................................................................................................................................ |
|---|
| 1624 | + | 49.2................................................................................................................................................ |
|---|
| 1625 | + | 49.3 The following information is furnished by the association named above according to |
|---|
| 1626 | + | 49.4Minnesota Statutes, section 515B.4-107. |
|---|
| 1627 | + | 49.5 1. There is no right of first refusal or other restraint on the free alienability of the above |
|---|
| 1628 | + | 49.6unit(s) contained in the declaration, bylaws, rules and regulations, or any amendment to |
|---|
| 1629 | + | 49.7them, except as follows:......................................................................................................... |
|---|
| 1630 | + | 49.8................................................................................................................................................ |
|---|
| 1631 | + | 49.9................................................................................................................................................ |
|---|
| 1632 | + | 49.10................................................................................................................................................ |
|---|
| 1633 | + | 49.11 2. The following periodic installments of common expense assessments and special |
|---|
| 1634 | + | 49.12assessments are payable with respect to the above unit(s): |
|---|
| 1635 | + | Due:........................................$.............Annual assessment installments:49.13 a. |
|---|
| 1636 | + | Due:........................................$.............Special assessment installments:49.14 b. |
|---|
| 1637 | + | Unpaid assessments, fines, or other charges:49.15 c. |
|---|
| 1638 | + | $.............Annual49.16 (1) |
|---|
| 1639 | + | $.............Special49.17 (2) |
|---|
| 1640 | + | $.............Fines49.18 (3) |
|---|
| 1641 | + | $.............Other Charges49.19 (4) |
|---|
| 1642 | + | The association has/has not (strike one) approved a plan for levying certain |
|---|
| 1643 | + | 49.21 common expense assessments against fewer than all the units according to |
|---|
| 1644 | + | 49.20 d. |
|---|
| 1645 | + | 49.22 Minnesota Statutes, section 515B.3-115, subsection (e). If a plan is approved, a |
|---|
| 1646 | + | 49.23 description of the plan is attached to this certificate. |
|---|
| 1647 | + | 49.24 3. In addition to the amounts due under paragraph 2, the following additional fees or |
|---|
| 1648 | + | 49.25charges other than assessments are payable by unit owners (include late payment charges, |
|---|
| 1649 | + | 49.26user fees, etc.): |
|---|
| 1650 | + | 49.27................................................................................................................................................ |
|---|
| 1651 | + | 49.28................................................................................................................................................ |
|---|
| 1652 | + | 49.29................................................................................................................................................ |
|---|
| 1653 | + | 49.30 4. There are no extraordinary expenditures approved by the association, and not yet |
|---|
| 1654 | + | 49.31assessed, for the current and two succeeding fiscal years, except as follows:....................... |
|---|
| 1655 | + | 49.32................................................................................................................................................ |
|---|
| 1656 | + | 49.33................................................................................................................................................ |
|---|
| 1657 | + | 49Article 2 Sec. 17. |
|---|
| 1658 | + | REVISOR MS/AD 25-0391902/17/25 50.1 5. The association is obligated to replace the following components of the common |
|---|
| 1659 | + | 50.2interest community:............................................................................................................... |
|---|
| 1660 | + | 50.3................................................................................................................................................ |
|---|
| 1661 | + | 50.4................................................................................................................................................ |
|---|
| 1662 | + | 50.5 The association has the following amounts in its reserves for replacement of those |
|---|
| 1663 | + | 50.6components: |
|---|
| 1664 | + | 50.7................................................................................................................................................ |
|---|
| 1665 | + | 50.8................................................................................................................................................ |
|---|
| 1666 | + | 50.9The replacement of the following components is funded by assessments levied only against |
|---|
| 1667 | + | 50.10the unit or units served by the component, pursuant to Minnesota Statutes, section |
|---|
| 1668 | + | 50.11515B.3-115(e)(1) or (2).......................................................................................................... |
|---|
| 1669 | + | 50.12................................................................................................................................................ |
|---|
| 1670 | + | 50.13................................................................................................................................................ |
|---|
| 1671 | + | 50.14 6. The following documents are furnished with this certificate according to statute: |
|---|
| 1672 | + | The most recent regularly prepared balance sheet and income and expense |
|---|
| 1673 | + | 50.16 statement of the association. |
|---|
| 1674 | + | 50.15 a. |
|---|
| 1675 | + | The current budget of the association.50.17 b. |
|---|
| 1676 | + | 50.18 7. There are no unsatisfied judgments against the association, except as follows (identify |
|---|
| 1677 | + | 50.19creditor and amount):............................................................................................................. |
|---|
| 1678 | + | 50.20................................................................................................................................................ |
|---|
| 1679 | + | 50.21................................................................................................................................................ |
|---|
| 1680 | + | 50.22 8. There are no pending lawsuits to which the association is a party, except as follows |
|---|
| 1681 | + | 50.23(identify and summarize status):............................................................................................ |
|---|
| 1682 | + | 50.24................................................................................................................................................ |
|---|
| 1683 | + | 50.25................................................................................................................................................ |
|---|
| 1684 | + | 50.26 9. Description of insurance coverages: |
|---|
| 1685 | + | 50.27 a. The association provides the following insurance coverage for the benefit of unit |
|---|
| 1686 | + | 50.28owners: (Reference may be made to applicable sections of the declaration or bylaws; |
|---|
| 1687 | + | 50.29however, any additional coverages should be described in this space)................................. |
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| 1688 | + | 50.30................................................................................................................................................ |
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| 1689 | + | 50Article 2 Sec. 17. |
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| 1690 | + | REVISOR MS/AD 25-0391902/17/25 51.1................................................................................................................................................ |
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| 1691 | + | 51.2................................................................................................................................................ |
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| 1692 | + | 51.3 b. The following described fixtures, decorating items, or construction items within the |
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| 1693 | + | 51.4unit referred to in Minnesota Statutes, section 515B.3-113, subsection (b), are insured by |
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| 1694 | + | 51.5the association (check as applicable): |
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| 1695 | + | 51.6..... Ceiling or wall finishing materials |
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| 1696 | + | 51.7..... Finished flooring |
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| 1697 | + | 51.8..... Cabinetry |
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| 1698 | + | 51.9..... Finished millwork |
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| 1699 | + | 51.10..... Electrical, heating, ventilating, and air conditioning equipment, or plumbing fixtures |
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| 1700 | + | 51.11serving a single unit |
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| 1701 | + | 51.12..... Built-in appliances |
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| 1702 | + | 51.13..... Improvements and betterments as originally constructed |
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| 1703 | + | 51.14..... Additional improvements and betterments installed by unit owners |
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| 1704 | + | 51.15 10. The board of directors of the association has not notified the unit owner (i) that any |
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| 1705 | + | 51.16alterations or improvements to the unit or to the limited common elements assigned to it |
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| 1706 | + | 51.17violate any provision of the declaration; or (ii) that the unit is in violation of any governmental |
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| 1707 | + | 51.18statute, ordinance, code, or regulation, except as follows:.................................................... |
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| 1708 | + | 51.19................................................................................................................................................ |
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| 1709 | + | 51.20 11. The remaining term of any leasehold estate affecting the common interest community |
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| 1710 | + | 51.21and the premises governing any extension or renewal of it are as follows:........................... |
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| 1711 | + | 51.22................................................................................................................................................ |
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| 1712 | + | 51.23................................................................................................................................................ |
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| 1713 | + | 51.24 12. This Resale Disclosure Certificate is given in connection with the resale of a unit |
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| 1714 | + | 51.25by a unit owner who is not a declarant and who, therefore, is not liable for express warranties |
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| 1715 | + | 51.26under Minnesota Statutes, section 515B.4-112, or implied warranties under Minnesota |
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| 1716 | + | 51.27Statutes, section 515B.4-113. The conveyance of this unit may, however, result in a transfer |
|---|
| 1717 | + | 51.28of preexisting warranties made by a declarant under the referenced statutes, subject to the |
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| 1718 | + | 51.29terms of Minnesota Statutes, sections 515B.4-114 and 515B.4-115. |
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| 1719 | + | 51Article 2 Sec. 17. |
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| 1720 | + | REVISOR MS/AD 25-0391902/17/25 52.1 13. In addition to the above, the following matters affecting the occupancy or use of the |
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| 1721 | + | 52.2unit, or the unit owner's obligations with respect to the unit, are deemed material:.............. |
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| 1722 | + | 52.3................................................................................................................................................ |
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| 1723 | + | 52.4 I hereby certify that the foregoing information and statements are true and correct as |
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| 1724 | + | 52.5of............................................................................................................................................ |
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| 1725 | + | 52.6.................................. |
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| 1726 | + | 52.7 (Date) |
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| 1727 | + | 52.8 By: ................................................................. |
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| 1728 | + | 52.9 Title: .............................................................. |
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| 1729 | + | 52.10 (Association representative) |
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| 1730 | + | 52.11 Address: ........................................................ |
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| 1731 | + | 52.12 Phone Number: ............................................. |
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| 1732 | + | 52.13 RECEIPT |
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| 1733 | + | 52.14In addition to the foregoing information furnished by the association, the unit owner is |
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| 1734 | + | 52.15obligated to furnish to the purchaser before execution of any purchase agreement for a unit |
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| 1735 | + | 52.16or otherwise before conveyance, copies of the following documents relating to the association |
|---|
| 1736 | + | 52.17or to the master association (as applicable): the declaration (other than any common interest |
|---|
| 1737 | + | 52.18community plat), articles of incorporation, bylaws, rules and regulations (if any), and any |
|---|
| 1738 | + | 52.19amendments to these documents. Receipt of the foregoing documents, and the resale |
|---|
| 1739 | + | 52.20disclosure certificate, is acknowledged by the undersigned buyer(s). |
|---|
| 1740 | + | .........................................................52.21 Dated: .................................. |
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| 1741 | + | 52.22 (Buyer) |
|---|
| 1742 | + | 52.23 ......................................................... |
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| 1743 | + | 52.24 (Buyer) |
|---|
| 1744 | + | 52.25 (c) If the common interest community is subject to a master declaration and governed |
|---|
| 1745 | + | 52.26by a master association to which has been delegated any of the association's powers under |
|---|
| 1746 | + | 52.27section 515B.3-102(a)(2), then the financial information required to be disclosed under |
|---|
| 1747 | + | 52.28subsection (b) may be disclosed on a consolidated basis. |
|---|
| 1748 | + | 52.29 (d) The association, within ten days after a request by a unit owner, or the unit owner's |
|---|
| 1749 | + | 52.30authorized representative, shall furnish the certificate required in subsection (a). The |
|---|
| 1750 | + | 52.31association may charge a reasonable fee for furnishing the certificate and any association |
|---|
| 1751 | + | 52.32documents related thereto. A unit owner providing a certificate pursuant to subsection (a) |
|---|
| 1752 | + | 52.33is not liable to the purchaser for any erroneous information provided by the association and |
|---|
| 1753 | + | 52.34included in the certificate. A unit owner who has acquired title to a unit pursuant to section |
|---|
| 1754 | + | 52Article 2 Sec. 17. |
|---|
| 1755 | + | REVISOR MS/AD 25-0391902/17/25 53.1515B.3-104 including, but not limited to, a unit owner who has acquired title through |
|---|
| 1756 | + | 53.2foreclosure or a deed in lieu of foreclosure, must indicate to the association in connection |
|---|
| 1757 | + | 53.3with a request for a resale disclosure certificate whether the requesting unit owner is or is |
|---|
| 1758 | + | 53.4not a declarant. The unit owner, not the association, is liable for any damage, loss, or other |
|---|
| 1759 | + | 53.5consequence arising out of the incorrect representation of its declarant status. |
|---|
| 1760 | + | 53.6 (e) A purchaser is not liable for any unpaid common expense assessments, including |
|---|
| 1761 | + | 53.7special assessments, if any, not set forth in the certificate required in subsection (a). A |
|---|
| 1762 | + | 53.8purchaser is not liable for the amount by which the annual or special assessments exceed |
|---|
| 1763 | + | 53.9the amount of annual or special assessments stated in the certificate for assessments payable |
|---|
| 1764 | + | 53.10in the year in which the certificate was given, except to the extent of any increases |
|---|
| 1765 | + | 53.11subsequently approved in accordance with the declaration or bylaws. A unit owner is not |
|---|
| 1766 | + | 53.12liable to a purchaser for the failure of the association to provide the certificate, or a delay |
|---|
| 1767 | + | 53.13by the association in providing the certificate in a timely manner. |
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| 1768 | + | 53.14 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1769 | + | 53.15Sec. 18. Minnesota Statutes 2024, section 515B.4-116, is amended to read: |
|---|
| 1770 | + | 53.16 515B.4-116 RIGHTS OF ACTION; RETALIATION PROHIBITED; ATTORNEY'S |
|---|
| 1771 | + | 53.17FEES. |
|---|
| 1772 | + | 53.18 (a) In addition to any other rights to recover damages, attorney's fees, costs or expenses, |
|---|
| 1773 | + | 53.19whether authorized by this chapter or otherwise, if a declarant, an association, or any other |
|---|
| 1774 | + | 53.20person violates any provision of this chapter, or any provision of the declaration, bylaws, |
|---|
| 1775 | + | 53.21or rules and regulations any person or class of persons adversely affected by the failure to |
|---|
| 1776 | + | 53.22comply has a claim for appropriate relief. Subject to the requirements of section 515B.3-102, |
|---|
| 1777 | + | 53.23the association shall have standing to pursue claims on behalf of the unit owners of two or |
|---|
| 1778 | + | 53.24more units. An association is liable to a unit owner for actual damages and shall pay to the |
|---|
| 1779 | + | 53.25unit owner a civil penalty in an amount up to $1,000. |
|---|
| 1780 | + | 53.26 (b) The court may award reasonable attorney's fees and costs of litigation to the prevailing |
|---|
| 1781 | + | 53.27party. Punitive damages may be awarded for a willful failure to comply. |
|---|
| 1782 | + | 53.28 (c) As a condition precedent to any construction defect claim, the parties to the claim |
|---|
| 1783 | + | 53.29must submit the matter to mediation before a mutually agreeable neutral third party. For |
|---|
| 1784 | + | 53.30the purposes of this section, mediation has the meaning given under the General Rules of |
|---|
| 1785 | + | 53.31Practice, rule 114.02 (7). If the parties are not able to agree on a neutral third-party mediator |
|---|
| 1786 | + | 53.32from the roster maintained by the Minnesota Supreme Court, the parties may petition the |
|---|
| 1787 | + | 53.33district court in the jurisdiction in which the common interest community is located to |
|---|
| 1788 | + | 53Article 2 Sec. 18. |
|---|
| 1789 | + | REVISOR MS/AD 25-0391902/17/25 54.1appoint a mediator. The applicable statute of limitations and statute of repose for an action |
|---|
| 1790 | + | 54.2based on breach of a warranty imposed by this section, or any other action in contract, tort, |
|---|
| 1791 | + | 54.3or other law for any injury to real or personal property or bodily injury or wrongful death |
|---|
| 1792 | + | 54.4arising out of the alleged construction defect, is tolled from the date that any party makes |
|---|
| 1793 | + | 54.5a written demand for mediation under this section until the latest of the following: |
|---|
| 1794 | + | 54.6 (1) five business days after mediation is completed; or |
|---|
| 1795 | + | 54.7 (2) 180 days. |
|---|
| 1796 | + | 54.8 Notwithstanding the foregoing, mediation shall not be required prior to commencement |
|---|
| 1797 | + | 54.9of a construction defect claim if the parties have completed home warranty dispute resolution |
|---|
| 1798 | + | 54.10under section 327A.051. |
|---|
| 1799 | + | 54.11 (d) The remedies provided for under this chapter are not exclusive and do not abrogate |
|---|
| 1800 | + | 54.12any remedies under other statutes or the common law, notwithstanding whether those |
|---|
| 1801 | + | 54.13remedies are referred to in this chapter. |
|---|
| 1802 | + | 54.14 (e) An association may not retaliate against a unit owner for asserting any right the unit |
|---|
| 1803 | + | 54.15owner has under this chapter or other law. For purposes of this subsection, "asserting any |
|---|
| 1804 | + | 54.16rights" includes but is not limited to filing an action in district court to enforce a right or |
|---|
| 1805 | + | 54.17remedy provided by this chapter, other law, or the declaration, bylaws, rules, or regulations |
|---|
| 1806 | + | 54.18of the association; or by filing a complaint with local authorities regarding a violation of a |
|---|
| 1807 | + | 54.19health, safety, housing, or building code or ordinance. An association may not decrease |
|---|
| 1808 | + | 54.20services or impose a fine or other penalty or charge legal fees to a unit owner, nor may the |
|---|
| 1809 | + | 54.21association make the resumption of services or removal of the fine, penalty, or legal fees |
|---|
| 1810 | + | 54.22contingent on a unit owner withdrawing an action in district court or complaint with local |
|---|
| 1811 | + | 54.23authorities. |
|---|
| 1812 | + | 54.24 EFFECTIVE DATE.This section is effective January 1, 2026. |
|---|
| 1813 | + | 54.25 ARTICLE 3 |
|---|
| 1814 | + | 54.26 LOCAL GOVERNMENT PREEMPTION |
|---|
| 1815 | + | 54.27Section 1. Minnesota Statutes 2024, section 394.25, is amended by adding a subdivision |
|---|
| 1816 | + | 54.28to read: |
|---|
| 1817 | + | 54.29 Subd. 11.Homeowners associations.(a) A county must not condition approval of a |
|---|
| 1818 | + | 54.30residential building permit or conditional use permit; residential subdivision development |
|---|
| 1819 | + | 54.31or residential planned unit development; or any other permit related to residential |
|---|
| 1820 | + | 54.32development on the: |
|---|
| 1821 | + | 54Article 3 Section 1. |
|---|
| 1822 | + | REVISOR MS/AD 25-0391902/17/25 55.1 (1) creation of a homeowners association; |
|---|
| 1823 | + | 55.2 (2) inclusion of any service, feature, or common property necessitating a homeowners |
|---|
| 1824 | + | 55.3association; |
|---|
| 1825 | + | 55.4 (3) inclusion of any terms in a homeowners association declaration, bylaws, articles of |
|---|
| 1826 | + | 55.5incorporation, or any other governing document that is not required under state law; or |
|---|
| 1827 | + | 55.6 (4) adoption or revocation of, or amendment to, a rule or regulation governing the |
|---|
| 1828 | + | 55.7homeowners association or its members. |
|---|
| 1829 | + | 55.8 (b) A county must not take any action that requires a residential property to be part of |
|---|
| 1830 | + | 55.9a homeowners association or provide an incentive for such membership. A county must not |
|---|
| 1831 | + | 55.10require or incentivize a homeowners association to adopt, revoke, or amend a term in any |
|---|
| 1832 | + | 55.11governing document or a rule or regulation not required under state law. |
|---|
| 1833 | + | 55.12Sec. 2. [462.3577] MUNICIPALITIES; HOMEOWNERS ASSOCIATIONS. |
|---|
| 1834 | + | 55.13 (a) A municipality, joint planning board, or public corporation must not condition |
|---|
| 1835 | + | 55.14approval of a residential building permit or conditional use permit; residential subdivision |
|---|
| 1836 | + | 55.15development or residential planned unit development; or any other permit related to |
|---|
| 1837 | + | 55.16residential development on the: |
|---|
| 1838 | + | 55.17 (1) creation of a homeowners association; |
|---|
| 1839 | + | 55.18 (2) inclusion of any service, feature, or common property necessitating a homeowners |
|---|
| 1840 | + | 55.19association; |
|---|
| 1841 | + | 55.20 (3) inclusion of any terms in a homeowners association declaration, bylaws, articles of |
|---|
| 1842 | + | 55.21incorporation, or any other governing document that is not required under state law; or |
|---|
| 1843 | + | 55.22 (4) adoption or revocation of, or amendment to, a rule or regulation governing the |
|---|
| 1844 | + | 55.23homeowners association or its members. |
|---|
| 1845 | + | 55.24 (b) A municipality, joint planning board, public corporation, or the Metropolitan Council |
|---|
| 1846 | + | 55.25must not take any action that requires a residential property to be part of a homeowners |
|---|
| 1847 | + | 55.26association or provide an incentive for such membership. A municipality, joint planning |
|---|
| 1848 | + | 55.27board, public corporation, or the Metropolitan Council must not require or incentivize a |
|---|
| 1849 | + | 55.28homeowners association to adopt, revoke, or amend a term in any governing document or |
|---|
| 1850 | + | 55.29a rule or regulation not required under state law. |
|---|
| 1851 | + | 55Article 3 Sec. 2. |
|---|
| 1852 | + | REVISOR MS/AD 25-0391902/17/25 Page.Ln 1.13PROPERTY MANAGEMENT ..............................................................ARTICLE 1 |
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| 1853 | + | Page.Ln 3.1COMMON INTEREST COMMUNITIES.............................................ARTICLE 2 |
|---|
| 1854 | + | Page.Ln 54.25LOCAL GOVERNMENT PREEMPTION............................................ARTICLE 3 |
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