(Reprinted with amendments adopted on April 17, 2025)
FIRST REPRINT S.B. 121
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SENATE BILL NO. 121–SENATOR NEAL
PREFILED JANUARY 28, 2025
____________
Referred to Committee on Judiciary
SUMMARY—Revises provisions governing common-interest
communities. (BDR 10-80)
FISCAL NOTE: Effect on Local Government: No.
Effect on the State: No.
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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
AN ACT relating to common-interest communities; prohibiting a
unit-owners’ association for a common -interest
community from requiring landscaping under certain
circumstances; revising provisions governing the
collection of past due obligations by a unit-owners’
association; revising provisions governing damages to
real property in a unit-owners’ association; prohibiting a
unit-owners’ association from restricting the parking of
certain vehicles; requiring certain notice of termination or
assignment of an agreement for the management of a
common-interest community under certain circumstances;
and providing other matters properly relating thereto.
Legislative Counsel’s Digest:
Existing law requires a unit-owners’ association for a common-interest 1
community to adopt bylaws and authorizes an association to amend the bylaws and 2
adopt rules and regulations concerning the community. (NRS 116.3102) Section 1 3
of this bill prohibits the executive board and governing documents of an association 4
from requiring a unit’s owner to install landscaping in the back yard of his or her 5
unit sooner than 36 months after the close of escrow for the initial purchase of the 6
unit. Section 1 further authorizes the executive board and governing documents of 7
an association to require a unit’s owner to install a thin layer of rock in the back 8
yard of his or her unit not sooner than 18 months after the close of escrow for the 9
initial purchase of the unit. 10
Existing law authorizes a unit-owners’ association to charge reasonable fees for 11
costs associated with collecting any past due obligation. (NRS 116.310313) Section 12
2 of this bill prohibits an association from: (1) charging any late fee sooner than 30 13
days after an obligation becomes past due; and (2) reporting any past due obligation 14
to a reporting agency that assembles or evaluates information concerning credit. 15
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Existing law authorizes a unit-owners’ association to assess a unit’s owner for 16
certain damages or common expenses. (NRS 116.3115) Section 3 of this bill 17
prohibits an association from assessing a unit’s owner for an oil stain that is located 18
entirely on the driveway of the unit’s owner. 19
Existing law authorizes the governing documents of a unit-owners’ association 20
to set forth rules that reasonably restrict parking in the common-interest community 21
and authorizes an association to impose fines for a violation of the governing 22
documents. Existing law also prohibits an association from restricting the parking 23
of certain utility service vehicles, law enforcement vehicles and emergency services 24
vehicles under certain circumstances. (NRS 116.31031, 116.350) Section 4 of this 25
bill prohibits an association from restricting the parking of certain vehicles 26
displaying a commercial advertisement, other than vehicles displaying a 27
commercial advertisement containing a sexual portrayal or depicting an image 28
relating to the sale of a controlled substance. An association may require such 29
images to be obscured by a magnet. 30
Existing law imposes certain requirements relating to agreements for the 31
management of a common-interest community and requires the Commission for 32
Common-Interest Communities and Condominium Hotels to adopt regulations 33
regarding the transfer of all books, records and other papers of a client upon the 34
termination or assignment of such an agreement. (NRS 116A.620) Section 5 of this 35
bill requires, with certain exceptions, the association to provide notice of the 36
termination of an agreement to be posted within the common elements of an 37
association and provided by electronic mail to all units’ owners who have provided 38
the association with an electronic mail address. 39
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Chapter 116 of NRS is hereby amended by adding 1
thereto a new section to read as follows: 2
1. Except as otherwise provided in subsection 2, the executive 3
board of an association and the governing documents of that 4
association may not require a unit’s owner to install landscaping 5
in the back yard of his or her unit sooner than 36 months after the 6
close of escrow for the initial purchase of the unit. 7
2. The executive board of an association and the governing 8
documents of that association may require a unit’s owner to install 9
a thin layer of rock in the back yard of his or her unit not sooner 10
than 18 months after the close of escrow for the initial purchase of 11
the unit. 12
Sec. 2. NRS 116.310313 is hereby amended to read as 13
follows: 14
116.310313 1. [An] Except as otherwise provided in 15
subsection 2, an association may charge a unit’s owner reasonable 16
fees to cover the costs of collecting any past due obligation. The 17
Commission shall adopt regulations establishing the amount of the 18
fees that an association may charge pursuant to this section. 19
2. An association may not: 20
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(a) Charge a unit’s owner a late fee sooner than 30 days after 1
any obligation becomes past due. 2
(b) Report any past due obligation to a reporting agency that 3
assembles or evaluates information concerning credit. 4
3. The provisions of this section apply to any costs of 5
collecting a past due obligation charged to a unit’s owner, regardless 6
of whether the past due obligation is collected by the association 7
itself or by any person acting on behalf of the association, including, 8
without limitation, an officer or employee of the association, a 9
community manager or a collection agency. 10
[3.] 4. As used in this section: 11
(a) “Costs of collecting” includes any fee, charge or cost, by 12
whatever name, including, without limitation, any collection fee, 13
filing fee, recording fee, fee related to the preparation, recording or 14
delivery of a lien or lien rescission, title search lien fee, bankruptcy 15
search fee, referral fee, fee for postage or delivery and any other fee 16
or cost that an association charges a unit’s owner for the 17
investigation, enforcement or collection of a past due obligation. 18
The term does not include any costs incurred by an association if a 19
lawsuit is filed to enforce any past due obligation or any costs 20
awarded by a court. 21
(b) “Obligation” means any assessment, fine, construction 22
penalty, fee, charge or interest levied or imposed against a unit’s 23
owner pursuant to any provision of this chapter or the governing 24
documents. 25
Sec. 3. NRS 116.3115 is hereby amended to read as follows: 26
116.3115 1. Until the association makes an assessment for 27
common expenses, the declarant shall pay all common expenses. 28
After an assessment has been made by the association, assessments 29
must be made at least annually, based on a budget adopted at least 30
annually by the association in accordance with the requirements set 31
forth in NRS 116.31151. Unless the declaration imposes more 32
stringent standards, the budget must include a budget for the daily 33
operation of the association and a budget for the reserves required 34
by paragraph (b) of subsection 2. 35
2. Except for assessments under subsections 4 to 7, inclusive, 36
or as otherwise provided in this chapter: 37
(a) All common expenses, including the reserves, must be 38
assessed against all the units in accordance with the allocations set 39
forth in the declaration pursuant to subsections 1 and 2 of 40
NRS 116.2107. 41
(b) The association shall establish adequate reserves, funded on 42
a reasonable basis, for the repair, replacement and restoration of the 43
major components of the common elements and any other portion of 44
the common-interest community that the association is obligated to 45
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maintain, repair, replace or restore. The reserves may be used only 1
for those purposes, including, without limitation, repairing, 2
replacing and restoring roofs, roads and sidewalks, and must not be 3
used for daily maintenance. The association may comply with the 4
provisions of this paragraph through a funding plan that is designed 5
to allocate the costs for the repair, replacement and restoration of the 6
major components of the common elements and any other portion of 7
the common-interest community that the association is obligated to 8
maintain, repair, replace or restore over a period of years if the 9
funding plan is designed in an actuarially sound manner which will 10
ensure that sufficient money is available when the repair, 11
replacement and restoration of the major components of the 12
common elements or any other portion of the common-interest 13
community that the association is obligated to maintain, repair, 14
replace or restore are necessary. Notwithstanding any provision of 15
the governing documents to the contrary, to establish adequate 16
reserves pursuant to this paragraph, including, without limitation, to 17
establish or carry out a funding plan, the executive board may, 18
without seeking or obtaining the approval of the units’ owners, 19
impose any necessary and reasonable assessments against the units 20
in the common-interest community. Any such assessments imposed 21
by the executive board must be based on the study of the reserves of 22
the association conducted pursuant to NRS 116.31152. 23
3. Any assessment for common expenses or installment thereof 24
that is 60 days or more past due bears interest at a rate equal to the 25
prime rate at the largest bank in Nevada as ascertained by the 26
Commissioner of Financial Institutions on January 1 or July 1, as 27
the case may be, immediately preceding the date the assessment 28
becomes past due, plus 2 percent. The rate must be adjusted 29
accordingly on each January 1 and July 1 thereafter until the balance 30
is satisfied. 31
4. Except as otherwise provided in the governing documents: 32
(a) Any common expense associated with the maintenance, 33
repair, restoration or replacement of a limited common element 34
must be assessed against the units to which that limited common 35
element is assigned, equally, or in any other proportion the 36
declaration provides; 37
(b) Any common expense benefiting fewer than all of the units 38
or their owners, including, without limitation, common expenses 39
consisting of the payment, on behalf of a unit’s owner, of delinquent 40
property taxes or utility charges owed by the unit’s owner, may be 41
assessed exclusively against the units or units’ owners benefited; 42
and 43
(c) The costs of insurance must be assessed in proportion to risk 44
and the costs of utilities must be assessed in proportion to usage. 45
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5. Assessments to pay a judgment against the association may 1
be made only against the units in the common-interest community at 2
the time the judgment was entered, in proportion to their liabilities 3
for common expenses. 4
6. If damage to a unit or other part of the common-interest 5
community, or if any other common expense is caused by the willful 6
misconduct or gross negligence of any unit’s owner, tenant or 7
invitee of a unit’s owner or tenant, the association may assess that 8
expense exclusively against his or her unit, even if the association 9
maintains insurance with respect to that damage or common 10
expense, unless the damage or other common expense is caused by a 11
vehicle and is [committed] : 12
(a) Committed by a person who is delivering goods to, or 13
performing services for, the unit’s owner, tenant or invitee of the 14
unit’s owner or tenant [.] ; or 15
(b) An oil stain that is located entirely on the driveway of the 16
unit’s owner. 17
7. The association of a common-interest community created 18
before January 1, 1992, is not required to make an assessment 19
against a vacant lot located within the community that is owned by 20
the declarant. 21
8. If liabilities for common expenses are reallocated, 22
assessments for common expenses and any installment thereof not 23
yet due must be recalculated in accordance with the reallocated 24
liabilities. 25
9. The association shall provide written notice to each unit’s 26
owner of a meeting at which an assessment for a capital 27
improvement is to be considered or action is to be taken on such an 28
assessment at least 21 calendar days before the date of the meeting. 29
Sec. 4. NRS 116.350 is hereby amended to read as follows: 30
116.350 1. In a common-interest community which is not 31
gated or enclosed and the access to which is not restricted or 32
controlled by a person or device, the executive board shall not and 33
the governing documents must not provide for the regulation of any 34
road, street, alley or other thoroughfare the right-of-way of which is 35
accepted by the State or a local government for dedication as a road, 36
street, alley or other thoroughfare for public use. 37
2. Except as otherwise provided in subsection 3, the provisions 38
of subsection 1 do not preclude an association from adopting, and 39
do not preclude the governing documents of an association from 40
setting forth, rules that reasonably restrict the parking or storage of 41
recreational vehicles, watercraft, trailers or commercial vehicles in 42
the common-interest community to the extent authorized by law. 43
The governing documents of an association may authorize the 44
executive board of the association to impose a fine pursuant to 45
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NRS 116.31031 for any violation of the rules authorized pursuant to 1
this subsection. 2
3. In any common-interest community, the executive board 3
shall not and the governing documents must not prohibit a person 4
from: 5
(a) Parking a utility service vehicle that has a gross vehicle 6
weight rating of 20,000 pounds or less: 7
(1) In an area designated for parking for visitors, in a 8
designated parking area or common parking area, or on the 9
driveway of the unit of a subscriber or consumer, while the person is 10
engaged in any activity relating to the delivery of public utility 11
services to subscribers or consumers; or 12
(2) In an area designated for parking for visitors, in a 13
designated parking area or common parking area, or on the 14
driveway of his or her unit, if the person is: 15
(I) A unit’s owner or a tenant of a unit’s owner; and 16
(II) Bringing the vehicle to his or her unit pursuant to his 17
or her employment with the entity which owns the vehicle for the 18
purpose of responding to emergency requests for public utility 19
services; [or] 20
(b) Parking a law enforcement vehicle or emergency services 21
vehicle: 22
(1) In an area designated for parking for visitors, in a 23
designated parking area or common parking area, or on the 24
driveway of the unit of a person to whom law enforcement or 25
emergency services are being provided, while the person is engaged 26
in his or her official duties; or 27
(2) In an area designated for parking for visitors, in a 28
designated parking area or common parking area, or on the 29
driveway of his or her unit, if the person is: 30
(I) A unit’s owner or a tenant of a unit’s owner; and 31
(II) Bringing the vehicle to his or her unit pursuant to his 32
or her employment with the entity which owns the vehicle for the 33
purpose of responding to requests for law enforcement services or 34
emergency services [.] ; or 35
(c) Except as otherwise provided in this paragraph, parking a 36
vehicle having a gross vehicle weight of less than 10,000 pounds 37
that contains a commercial advertisement in an area designated 38
for parking for visitors, in a designated parking area or common 39
parking area or on the driveway of his or her unit. An association 40
may not require the owner of such a vehicle to cover any 41
commercial advertisement, other than an advertisement 42
containing a sexual portrayal or an image relating to the sale of a 43
controlled substance. An association may require the owner to use 44
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a magnet to obscure any commercial advertisement containing 1
such images. 2
4. An association may require that a person parking a utility 3
service vehicle, law enforcement vehicle or emergency services 4
vehicle as set forth in paragraph (a) or (b) of subsection 3 provide 5
written confirmation from his or her employer that the person is 6
qualified to park his or her vehicle in the manner set forth in 7
subsection 3. 8
5. As used in this section: 9
(a) “Emergency services vehicle” means a vehicle: 10
(1) Owned by any governmental agency or political 11
subdivision of this State; and 12
(2) Identified by the entity which owns the vehicle as a 13
vehicle used to provide emergency services. 14
(b) “Law enforcement vehicle” means a vehicle: 15
(1) Owned by any governmental agency or political 16
subdivision of this State; and 17
(2) Identified by the entity which owns the vehicle as a 18
vehicle used to provide law enforcement services. 19
(c) “Sexual portrayal” has the meaning ascribed to it in 20
NRS 200.700. 21
(d) “Utility service vehicle” means any motor vehicle: 22
(1) Used in the furtherance of repairing, maintaining or 23
operating any structure or any other physical facility necessary for 24
the delivery of public utility services, including, without limitation, 25
the furnishing of electricity, gas, water, sanitary sewer, telephone, 26
cable or community antenna service; and 27
(2) Except for any emergency use, operated primarily within 28
the service area of a utility’s subscribers or consumers, without 29
regard to whether the motor vehicle is owned, leased or rented by 30
the utility. 31
Sec. 5. NRS 116A.620 is hereby amended to read as follows: 32
116A.620 1. Any management agreement must: 33
(a) Be in writing and signed by all parties; 34
(b) Be entered into between the client and the community 35
manager or the employer of the community manager if the 36
community manager is acting on behalf of a corporation, 37
partnership, limited partnership, limited-liability partnership, 38
limited-liability company or other entity; 39
(c) State the term of the management agreement; 40
(d) State the basic consideration for the services to be provided 41
and the payment schedule; 42
(e) Include a complete schedule of all fees, costs, expenses and 43
charges to be imposed by the community manager, whether direct or 44
indirect, including, without limitation: 45
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(1) The costs for any new client or start-up costs; 1
(2) The fees for special or nonroutine services, such as the 2
mailing of collection letters, the recording of liens and foreclosing 3
of property; 4
(3) Reimbursable expenses; 5
(4) The fees for the sale or resale of a unit or for setting up 6
the account of a new member; and 7
(5) The portion of fees that are to be retained by the client 8
and the portion to be retained by the community manager; 9
(f) State the identity and the legal status of the contracting 10
parties; 11
(g) State any limitations on the liability of each contracting 12
party; 13
(h) Include a statement of the scope of work of the community 14
manager; 15
(i) State the spending limits of the community manager; 16
(j) Include provisions relating to the grounds and procedures for 17
termination of the community manager; 18
(k) Identify the types and amounts of insurance coverage to be 19
carried by each contracting party, including, without limitation: 20
(1) A requirement that the community manager or his or her 21
employer shall maintain insurance covering liability for errors or 22
omissions, professional liability or a surety bond to compensate for 23
losses actionable pursuant to this chapter in an amount of 24
$1,000,000 or more; 25
(2) An indication of which contracting party will maintain 26
fidelity bond coverage; and 27
(3) A statement as to whether the client will maintain 28
directors and officers liability coverage for the executive board; 29
(l) Include provisions for dispute resolution; 30
(m) Acknowledge that all records and books of the client are the 31
property of the client, except any proprietary information and 32
software belonging to the community manager; 33
(n) State the physical location, including the street address, of 34
the records of the client, which must be within 60 miles from the 35
physical location of the common-interest community; 36
(o) State the frequency and extent of regular inspections of the 37
common-interest community; and 38
(p) State the extent, if any, of the authority of the community 39
manager to sign checks on behalf of the client in an operating 40
account. 41
2. In addition to any other requirements under this section, a 42
management agreement may: 43
(a) Provide for mandatory binding arbitration; or 44
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(b) Allow the provisions of the management agreement to apply 1
month to month following the end of the term of the management 2
agreement, but the management agreement may not contain an 3
automatic renewal provision. 4
3. Not later than 10 days after the effective date of a 5
management agreement, the community manager shall provide each 6
member of the executive board evidence of the existence of the 7
required insurance, including, without limitation: 8
(a) The names and addresses of all insurance companies; 9
(b) The total amount of coverage; and 10
(c) The amount of any deductible. 11
4. After signing a management agreement, the community 12
manager shall provide a copy of the management agreement to each 13
member of the executive board. Within 30 days after an election or 14
appointment of a new member to the executive board, the 15
community manager shall provide the new member with a copy of 16
the management agreement. 17
5. Any changes to a management agreement must be initialed 18
by the contracting parties. If there are any changes after the 19
execution of a management agreement, those changes must be in 20
writing and signed by the contracting parties. 21
6. Except as otherwise provided in subsection 8, not less than 22
40 days before any termination or assignment of a management 23
agreement, the secretary or other officer specified in the bylaws of 24
the association shall: 25
(a) In a common-interest community with 100 units or more, 26
post notice of the pending termination or assignment in one or 27
more prominent places within the common elements of the 28
association; and 29
(b) Provide electronic notice of the pending termination or 30
assignment to all units’ owners who have provided the association 31
with an electronic mail address. 32
7. Until the regulations adopted by the Commission pursuant to 33
subsection [8] 9 become effective, and except as otherwise provided 34
in the management agreement, upon the termination or assignment 35
of a management agreement, the community manager shall, within 36
30 days after the termination or assignment, transfer possession of 37
all books, records and other papers of the client to the succeeding 38
community manager, or to the client if there is no succeeding 39
community manager, regardless of any unpaid fees or charges to 40
the community manager or management company. 41
[7.] 8. Notwithstanding any provision in a management 42
agreement to the contrary, a management agreement may be 43
terminated by the client without penalty upon 30 days’ notice 44
following a violation by the community manager of any provision of 45
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this chapter or chapter 116 of NRS. Upon termination of the 1
agreement, the secretary or other officer specified in the bylaws of 2
the association shall: 3
(a) In a common-interest community with 100 or more units, 4
post notice of the termination in one or more prominent places 5
within the common elements of the association; and 6
(b) Provide electronic notice of the termination to all units’ 7
owners who have provided the association with an electronic mail 8
address. 9
[8.] 9. The Commission shall adopt regulations establishing 10
the requirements relating to the transfer of all books, records and 11
other papers of the client upon the termination or assignment of a 12
management agreement. 13
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