Third Substitute H.B. 89

Representative Earl D. Tanner proposes the following substitute bill:


             1     
ASSOCIATION RENTAL AMENDMENTS

             2     
2014 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Earl D. Tanner

             5     
Senate Sponsor: Wayne A. Harper

             6      Cosponsors:
             7      Gage FroererCurtis Oda              8     
             9      LONG TITLE
             10      General Description:
             11          This bill modifies provisions of the Condominium Ownership Act and the Community
             12      Association Act relating to rentals.
             13      Highlighted Provisions:
             14          This bill:
             15          .    provides that, regardless of when the association's initial declaration is recorded, a
             16      condominium association or a homeowners association may only restrict or prohibit
             17      rentals in accordance with the provisions of this bill if, on or after May 13, 2014, the
             18      association:
             19              .    adopts a rental restriction or prohibition; or
             20              .    amends an existing rental restriction or prohibition; and
             21          .    prohibits, except under certain circumstances, a condominium association or a
             22      homeowners association from requiring a unit owner or a lot owner to:
             23              .    obtain the association's approval of a prospective renter; or
             24              .    give the association a copy of certain documents relating to a renter;


             25          .    makes technical and conforming changes.
             26      Money Appropriated in this Bill:
             27          None
             28      Other Special Clauses:
             29          This bill coordinates with S.B. 147, Residential Rental Amendments, by providing
             30      superseding technical and substantive amendments.
             31      Utah Code Sections Affected:
             32      AMENDS:
             33           57-8-10 , as last amended by Laws of Utah 2011, Chapter 355
             34           57-8-13.8 , as last amended by Laws of Utah 1992, Chapter 12
             35           57-8-13.10 , as last amended by Laws of Utah 2003, Chapter 265
             36           57-8a-209 , as enacted by Laws of Utah 2009, Chapter 178
             37      ENACTS:
             38           57-8-10.1 , Utah Code Annotated 1953
             39      Utah Code Sections Affected by Coordination Clause:
             40           57-8-10.1 , Utah Code Annotated 1953
             41           57-8a-209 , as enacted by Laws of Utah 2009, Chapter 178
             42     
             43      Be it enacted by the Legislature of the state of Utah:
             44          Section 1. Section 57-8-10 is amended to read:
             45           57-8-10. Contents of declaration.
             46          (1) [Prior to] Before the conveyance of any unit in a condominium project, a
             47      declaration shall be recorded that contains the covenants, conditions, and restrictions relating to
             48      the project that shall be enforceable equitable servitudes, where reasonable, and which shall run
             49      with the land. Unless otherwise provided, these servitudes may be enforced by [any] a unit
             50      owner [and his successors] or a unit owner's successor in interest.
             51          (2) (a) For every condominium project, the declaration shall:
             52          (i) [The declaration shall] include a description of the land or interests in real property
             53      included within the project[.];
             54          (ii) [The declaration shall] contain a description of any buildings[, which] that states
             55      the number of storeys and basements, the number of units, the principal materials of which the


             56      building is or is to be constructed, and a description of all other significant improvements
             57      contained or to be contained in the project[.];
             58          (iii) [The declaration shall] contain the unit number of each unit, the square footage of
             59      each unit, and any other description or information necessary to properly identify each unit[.];
             60          (iv) [The declaration shall] describe the common areas and facilities of the project[.];
             61      and
             62          (v) [The declaration shall] describe any limited common areas and facilities and shall
             63      state to which units the use of the common areas and facilities is reserved.
             64          (b) Any shutters, awnings, window boxes, doorsteps, porches, balconies, patios, or
             65      other apparatus intended to serve a single unit, but located outside the boundaries of the unit,
             66      shall constitute a limited common area and facility appertaining to that unit exclusively,
             67      whether or not the declaration makes such a provision.
             68          (c) The condominium plat recorded with the declaration may provide or supplement
             69      the information required under Subsections (2)(a) and (b).
             70          (d) (i) The declaration shall include the percentage or fraction of undivided interest in
             71      the common areas and facilities appurtenant to each unit and [its] the unit owner for all
             72      purposes, including voting, derived and allocated in accordance with Subsection 57-8-7 (2).
             73          (ii) If any use restrictions are to apply, the declaration shall state the purposes for which
             74      the units are intended and [restricted as to] the use restrictions that apply.
             75          (iii) (A) The declaration shall include the name and address of a person to receive
             76      service of process on behalf of the project, in the cases provided by this chapter[, together with
             77      the residence or place of business of that person].
             78          (B) The person described in Subsection (2)(d)(iii)(A) shall be a resident of, or shall
             79      maintain a place of business within, this state.
             80          (iv) The declaration shall describe the method by which [it] the declaration may be
             81      amended consistent with this chapter.
             82          (v) Any further matters in connection with the property may be included in the
             83      declaration, which the person or persons executing the declaration may consider desirable,
             84      consistent with this chapter.
             85          (vi) The declaration shall contain a statement of intention that this chapter applies to
             86      the property.


             87          (e) The initial recorded declaration shall include:
             88          (i) an appointment of a trustee who qualifies under Subsection 57-1-21 (1)(a)(i) or (iv);
             89      and
             90          (ii) the following statement: "The declarant hereby conveys and warrants pursuant to
             91      U.C.A. Sections 57-1-20 and 57-8-45 to (name of trustee), with power of sale, the unit and all
             92      improvements to the unit for the purpose of securing payment of assessments under the terms
             93      of the declaration."
             94          (3) (a) If the condominium project contains any convertible land, the declaration shall:
             95          (i) [The declaration shall] contain a legal description by metes and bounds of each area
             96      of convertible land within the condominium project[.];
             97          (ii) [The declaration shall] state the maximum number of units that may be created
             98      within each area of convertible land[.];
             99          (iii) [(A) The declaration shall] state, with respect to each area of convertible land, the
             100      maximum percentage of the aggregate land and floor area of all units that may be created and
             101      the use of which will not or may not be restricted exclusively to residential purposes[. (B) The
             102      statements described in Subsection (3)(a)(iii)(A) need not be supplied if], unless none of the
             103      units on other portions of the land within the project are restricted exclusively to residential
             104      use[.];
             105          (iv) [The declaration shall] state the extent to which any structure erected on any
             106      convertible land will be compatible with structures on other portions of the land within the
             107      condominium project in terms of quality of construction, the principal materials to be used, and
             108      architectural style[.];
             109          (v) [The declaration shall] describe all other improvements that may be made on each
             110      area of convertible land within the condominium project[.];
             111          (vi) [The declaration shall] state that any units created within each area of convertible
             112      land will be substantially identical to the units on other portions of the land within the project
             113      or [it shall] describe in detail what other type of units may be created[.]; and
             114          (vii) [The declaration shall] describe the declarant's reserved right, if any, to create
             115      limited common areas and facilities within any convertible land in terms of the types, sizes, and
             116      maximum number of the limited common areas within each convertible land.
             117          (b) The condominium plat recorded with the declaration may provide or supplement


             118      the information required under Subsection (3)(a).
             119          (4) (a) If the condominium project is an expandable condominium project, the
             120      declaration shall:
             121          [(a)] (i) [(A) The declaration shall] contain an explicit reservation of an option to
             122      expand the project[.];
             123          [(B)] (ii) [The declaration shall] include a statement of any limitations on the option to
             124      expand, including a statement as to whether the consent of any unit owners [shall be] is
             125      required and, a statement as to the method by which consent shall be ascertained, or a
             126      statement that there are no such limitations[.];
             127          [(ii)] (iii) [The declaration shall] include a time limit, not exceeding seven years [from
             128      the date of the recording of] after the day on which the declaration is recorded, upon which the
             129      option to expand the condominium project [shall expire, together with] expires and a statement
             130      of any circumstances [which] that will terminate the option [prior to] before expiration of the
             131      specified time limits[.];
             132          [(iii)] (iv) [The declaration shall] contain a legal description by metes and bounds of all
             133      land that may be added to the condominium project, which is known as additional land[.];
             134          [(iv)] (v) [The declaration shall] state:
             135          (A) if any of the additional land is added to the condominium project, whether all of it
             136      or any particular portion of it must be added;
             137          (B) any limitations as to what portions may be added; or
             138          (C) a statement that there are no such limitations[.];
             139          [(v)] (vi) [The declaration shall] include a statement as to whether portions of the
             140      additional land may be added to the condominium project at different times, [together with]
             141      including any limitations fixing the boundaries of those portions by legal descriptions setting
             142      forth the metes and bounds of these lands and regulating the order in which they may be added
             143      to the condominium project[.];
             144          [(vi)] (vii) [The declaration shall] include a statement of any limitations [as to] on the
             145      locations of any improvements that may be made on any portions of the additional land added
             146      to the condominium project, or a statement that no assurances are made in that regard[.];
             147          [(vii)] (viii) (A) [The declaration shall] state the maximum number of units that may be
             148      created on the additional land[. If];


             149          (B) if portions of the additional land may be added to the condominium project and the
             150      boundaries of those portions are fixed in accordance with Subsection (4)(a)[(v)](vi), [the
             151      declaration shall also] state the maximum number of units that may be created on each portion
             152      added to the condominium project[. If]; and
             153          (C) if portions of the additional land may be added to the condominium project and the
             154      boundaries of those portions are not fixed in accordance with Subsection (4)(a)[(v)](vi), [then
             155      the declaration shall also] state the maximum number of units per acre that may be created on
             156      any portion added to the condominium project[.];
             157          [(viii)] (ix) [With] with respect to the additional land and to any portion of [it] the
             158      additional land that may be added to the condominium project, [the declaration shall] state the
             159      maximum percentage of the aggregate land and floor area of all units that may be created on it,
             160      the use of which will not or may not be restricted exclusively to residential purposes[.
             161      However, these statements need not be supplied if], unless none of the units on the land
             162      originally within the project are restricted exclusively to residential use[.];
             163          [(ix)] (x) [The declaration shall] state the extent to which any structures erected on any
             164      portion of the additional land added to the condominium project will be compatible with
             165      structures on the land originally within the project in terms of quality of construction, the
             166      principal materials to be used, and architectural style[. The declaration may also state], or that
             167      no assurances are made in those regards[.];
             168          [(x)] (xi) [The declaration shall] describe all other improvements that will be made on
             169      any portion of the additional land added to the condominium project, [or it shall contain a
             170      statement of] including any limitations [as to] on what other improvements may be made on [it.
             171      The declaration may also] the additional land, or state that no assurances are made in that
             172      regard[.];
             173          [(xi)] (xii) [The declaration shall] contain a statement that any units created on any
             174      portion of the additional land added to the condominium project will be substantially identical
             175      to the units on the land originally within the project, [or] a statement of any limitations [as to]
             176      on what types of units may be created on [it. The declaration may also contain] the additional
             177      land, or a statement that no assurances are made in that regard[.]; and
             178          [(xii)] (xiii) [The declaration shall] describe the declarant's reserved right, if any, to
             179      create limited common areas and facilities within any portion of the additional land added to


             180      the condominium project, in terms of the types, sizes, and maximum number of limited
             181      common areas within each portion[. The declaration may also], or state that no assurances are
             182      made in those regards.
             183          (b) The condominium plat recorded with the declaration may provide or supplement
             184      the information required under Subsections (4)(a)[(iii)](iv) through [(a)(vi)] (vii) and
             185      (4)(a)[(ix)](x) through [(a)(xii)] (xiii).
             186          (5) (a) If the condominium project is a contractible condominium, the declaration shall:
             187          [(a)] (i) [The declaration shall] contain an explicit reservation of an option to contract
             188      the condominium project[.];
             189          (ii) [The declaration shall] contain a statement of any limitations on the option to
             190      contract, including a statement [as to] regarding whether the consent of any unit owners [shall
             191      be] is required, and if so, a statement [as to] regarding the method by which this consent shall
             192      be ascertained[. The declaration may also contain], or a statement that there are no such
             193      limitations[.];
             194          (iii) [The declaration shall] state the time limit, not exceeding seven years [from the
             195      recording of] after the day on which the declaration is recorded, upon which the option to
             196      contract the condominium project [shall expire] expires, together with a statement of any
             197      circumstances [which] that will terminate [this] the option [prior to] before expiration of the
             198      specified time limit[.];
             199          [(b) (i)] (iv) [The declaration shall] include a legal description by metes and bounds of
             200      all land that may be withdrawn from the condominium project, which is known as
             201      withdrawable land[.];
             202          [(ii)] (v) [The declaration shall] include a statement as to whether portions of the
             203      withdrawable land may be withdrawn from the condominium project at different times,
             204      together with any limitations fixing the boundaries of those portions by legal descriptions
             205      setting forth the metes and bounds and regulating the order in which they may be withdrawn
             206      from the condominium project[.]; and
             207          [(iii)] (vi) [The declaration shall] include a legal description by metes and bounds of all
             208      of the land within the condominium project to which the option to contract the project does not
             209      extend.
             210          [(c)] (b) The condominium plat recorded with the declaration may provide or


             211      supplement the information required under [Subsection (5)(b)] Subsections (5)(a)(iv) through
             212      (vi).
             213          (6) (a) If the condominium project is a leasehold condominium, [then] the declaration
             214      shall, with respect to any ground lease or other leases the expiration or termination of which
             215      will or may terminate or contract the condominium project:
             216          (i) [The declaration shall] include recording information enabling the location of each
             217      lease in the official records of the county recorder[.];
             218          (ii) [The declaration shall] include the date upon which each lease is due to expire[.];
             219          (iii) [The declaration shall] state whether any land or improvements will be owned by
             220      the unit owners in fee simple[. If];
             221          (iv) if there is to be fee simple ownership[, the declaration shall] of any land or
             222      improvement, as described in Subsection (6)(a)(iii), include:
             223          (A) a description of the land or improvements, including [without limitation,] a legal
             224      description by metes and bounds of the land; or
             225          (B) a statement of any rights the unit owners have to remove these improvements
             226      within a reasonable time after the expiration or termination of the lease or leases involved, or a
             227      statement that they shall have no such rights[.]; and
             228          [(iv)] (v) [The declaration shall] include a statement of the rights the unit owners have
             229      to extend or renew any of the leases or to redeem or purchase any of the reversions, or a
             230      statement that they have no such rights.
             231          (b) After the recording of the declaration, [no] a lessor who executed the declaration,
             232      [and no] or the lessor's successor in interest [to this lessor, has any right or power to], may not
             233      terminate any part of the leasehold interest of any unit owner who:
             234          (i) makes timely payment of [his] the unit owner's share of the rent to the persons
             235      designated in the declaration for the receipt of the rent; and
             236          (ii) otherwise complies with all covenants which would entitle the lessor to terminate
             237      the lease if [they] the covenants were violated.
             238          (7) (a) If the condominium project contains time period units, the declaration shall also
             239      contain the location of each condominium unit in the calendar year. This information shall be
             240      set out in a fourth column of the exhibit or schedule referred to in Subsection 57-8-7 (2), if the
             241      exhibit or schedule accompanies the declaration.


             242          (b) The declaration shall also put timeshare owners on notice that tax notices will be
             243      sent to the management committee, not each timeshare owner.
             244          (c) The time period units created with respect to any given physical unit shall be such
             245      that the aggregate of the durations involved constitute a full calendar year.
             246          (8) (a) The declaration, bylaws, and condominium plat shall be duly executed and
             247      acknowledged by all of the owners and any lessees of the land which is made subject to this
             248      chapter.
             249          (b) As used in Subsection (8)(a), "owners and lessees" does not include, in their
             250      respective capacities, any mortgagee, any trustee or beneficiary under a deed of trust, any other
             251      lien holder, any person having an equitable interest under any contract for the sale or lease of a
             252      condominium unit, or any lessee whose leasehold interest does not extend to any portion of the
             253      common areas and facilities.
             254          [(9) (a) As used in this section, "rentals" or "rental unit" means:]
             255          [(i) a unit owned by an individual not described in Subsection (9)(a)(ii) that is occupied
             256      by someone while no unit owner occupies the unit as the unit owner's primary residence; and]
             257          [(ii) a unit owned by an entity or trust, regardless of who occupies the unit.]
             258          [(b) (i) Subject to Subsections (9)(c), (f), and (g), an association of unit owners may:]
             259          [(A) create restrictions on the number and term of rentals in a condominium project;
             260      or]
             261          [(B) prohibit rentals in the condominium project.]
             262          [(ii) An association of unit owners that creates a rental restriction or prohibition in
             263      accordance with Subsection (9)(b)(i) shall create the rental restriction or prohibition in a
             264      declaration or by amending the declaration.]
             265          [(c) If an association of unit owners prohibits or imposes restrictions on the number
             266      and term of rentals, the restrictions shall include:]
             267          [(i) a provision that requires a condominium project to exempt from the rental
             268      restrictions the following unit owner and the unit owner's unit:]
             269          [(A) a unit owner in the military for the period of the unit owner's deployment;]
             270          [(B) a unit occupied by a unit owner's parent, child, or sibling;]
             271          [(C) a unit owner whose employer has relocated the unit owner for no less than two
             272      years; or]


             273          [(D) a unit owned by a trust or other entity created for estate planning purposes if the
             274      trust or other estate planning entity was created for the estate of:]
             275          [(I) a current resident of the unit; or]
             276          [(II) the parent, child, or sibling of the current resident of the unit;]
             277          [(ii) a provision allowing a unit owner who has a rental in the condominium project
             278      before the time the rental restriction described in Subsection (9)(b)(i) is recorded with the
             279      county recorder of the county in which the condominium project is located to continue renting
             280      until:]
             281          [(A) the unit owner occupies the unit; or]
             282          [(B) an officer, owner, member, trustee, beneficiary, director, or person holding a
             283      similar position of ownership or control of an entity or trust that holds an ownership interest in
             284      the unit, occupies the unit; and]
             285          [(iii) a requirement that the association of unit owners create, by rule or resolution,
             286      procedures to:]
             287          [(A) determine and track the number of rentals and units in the condominium project
             288      subject to the provisions described in Subsections (9)(c)(i) and (ii); and]
             289          [(B) ensure consistent administration and enforcement of the rental restrictions.]
             290          [(d) For purposes of Subsection (9)(c)(ii), a transfer occurs when one or more of the
             291      following occur:]
             292          [(i) the conveyance, sale, or other transfer of a unit by deed;]
             293          [(ii) the granting of a life estate in the unit; or]
             294          [(iii) if the unit is owned by a limited liability company, corporation, partnership, or
             295      other business entity, the sale or transfer of more than 75% of the business entity's share, stock,
             296      membership interests, or partnership interests in a 12-month period.]
             297          [(e) This section does not limit or affect residency age requirements for an association
             298      of unit owners that complies with the requirements of the Housing for Older Persons Act, 42
             299      U.S.C. Sec. 3607.]
             300          [(f) A declaration or amendment to a declaration recorded prior to transfer of the first
             301      unit from the initial declarant may prohibit or restrict rentals without providing for the
             302      exceptions, provisions, and procedures required under Subsection (9)(c).]
             303          [(g) This section does not apply to:]


             304          [(i) a condominium project containing a time period unit as defined in Section 57-8-3 ;]
             305          [(ii) any other form of timeshare interest as defined in Section 57-19-2 ; or]
             306          [(iii) a condominium project in which the initial declaration is recorded before May 12,
             307      2009.]
             308          [(h) Notwithstanding this section, an association of unit owners may, upon unanimous
             309      approval by all unit owners, restrict or prohibit rentals without an exception described in
             310      Subsection (9)(c).]
             311          Section 2. Section 57-8-10.1 is enacted to read:
             312          57-8-10.1. Rental restrictions.
             313          (1) As used in this section, "rentals" or "rental unit" means:
             314          (a) a unit owned by an individual not described in Subsection (1)(b) that is occupied by
             315      someone while no unit owner occupies the unit as the unit owner's primary residence; and
             316          (b) a unit owned by an entity or trust, regardless of who occupies the unit.
             317          (2) (a) Subject to Subsections (2)(b), (6), and (7), an association of unit owners may:
             318          (i) create restrictions on the number and term of rentals in a condominium project; or
             319          (ii) prohibit rentals in the condominium project.
             320          (b) An association of unit owners that creates a rental restriction or prohibition in
             321      accordance with Subsection (2)(a) shall create the rental restriction or prohibition in a
             322      declaration or by amending the declaration.
             323          (3) If an association of unit owners prohibits or imposes restrictions on the number and
             324      term of rentals, the restrictions shall include:
             325          (a) a provision that requires a condominium project to exempt from the rental
             326      restrictions the following unit owner and the unit owner's unit:
             327          (i) a unit owner in the military for the period of the unit owner's deployment;
             328          (ii) a unit occupied by a unit owner's parent, child, or sibling;
             329          (iii) a unit owner whose employer has relocated the unit owner for no less than two
             330      years; or
             331          (iv) a unit owned by a trust or other entity created for estate planning purposes if the
             332      trust or other estate planning entity was created for the estate of:
             333          (A) a current resident of the unit; or
             334          (B) the parent, child, or sibling of the current resident of the unit;


             335          (b) a provision that allows a unit owner who has a rental in the condominium project
             336      before the time the rental restriction described in Subsection (2)(a) is recorded with the county
             337      recorder of the county in which the condominium project is located to continue renting until:
             338          (i) the unit owner occupies the unit; or
             339          (ii) an officer, owner, member, trustee, beneficiary, director, or person holding a
             340      similar position of ownership or control of an entity or trust that holds an ownership interest in
             341      the unit, occupies the unit; and
             342          (c) a requirement that the association of unit owners create, by rule or resolution,
             343      procedures to:
             344          (i) determine and track the number of rentals and units in the condominium project
             345      subject to the provisions described in Subsections (3)(a) and (b); and
             346          (ii) ensure consistent administration and enforcement of the rental restrictions.
             347          (4) For purposes of Subsection (3)(b), a transfer occurs when one or more of the
             348      following occur:
             349          (a) the conveyance, sale, or other transfer of a unit by deed;
             350          (b) the granting of a life estate in the unit; or
             351          (c) if the unit is owned by a limited liability company, corporation, partnership, or
             352      other business entity, the sale or transfer of more than 75% of the business entity's share, stock,
             353      membership interests, or partnership interests in a 12-month period.
             354          (5) This section does not limit or affect residency age requirements for an association
             355      of unit owners that complies with the requirements of the Housing for Older Persons Act, 42
             356      U.S.C. Sec. 3607.
             357          (6) A declaration or amendment to a declaration recorded before transfer of the first
             358      unit from the initial declarant may prohibit or restrict rentals without providing for the
             359      exceptions, provisions, and procedures required under Subsection (3).
             360          (7) Subsections (2) through (6) do not apply to:
             361          (a) a condominium project that contains a time period unit as defined in Section
             362      57-8-3 ;
             363          (b) any other form of timeshare interest as defined in Section 57-19-2 ; or
             364          (c) a condominium project in which the initial declaration is recorded before May 12,
             365      2009, unless, on or after May 13, 2014, the association of unit owners:


             366          (i) adopts a rental restriction or prohibition; or
             367          (ii) amends an existing rental restriction or prohibition.
             368          (8) Notwithstanding this section, an association of unit owners may, upon unanimous
             369      approval by all unit owners, restrict or prohibit rentals without an exception described in
             370      Subsection (3).
             371          (9) Except as provided in Subsection (10), an association of unit owners may not
             372      require a unit owner who owns a rental unit to:
             373          (a) obtain the association of unit owners' approval of a prospective renter; or
             374          (b) give the association of unit owners:
             375          (i) a copy of a rental application;
             376          (ii) a copy of a renter's or prospective renter's credit information or credit report;
             377          (iii) a copy of a renter's or prospective renter's background check; or
             378          (iv) documentation to verify the renter's age.
             379          (10) (a) A unit owner who owns a rental unit shall give an association of unit owners
             380      the documents described in Subsection (9)(b) if the unit owner is required to provide the
             381      documents by court order or as part of discovery under the Utah Rules of Civil Procedure.
             382          (b) If an association of unit owners' declaration lawfully prohibits or restricts
             383      occupancy of the units by a certain class of individuals, the association of unit owners may
             384      require a unit owner who owns a rental unit to give the association of unit owners the
             385      information described in Subsection (9)(b), if:
             386          (i) the information helps the association of unit owners determine whether the renter's
             387      occupancy of the unit complies with the association of unit owners' declaration; and
             388          (ii) the association of unit owners uses the information to determine whether the
             389      renter's occupancy of the unit complies with the association of unit owners' declaration.
             390          Section 3. Section 57-8-13.8 is amended to read:
             391           57-8-13.8. Contraction of project.
             392          A condominium project may be contracted under the provisions of the declaration and
             393      the provisions of this chapter. Any such contraction shall be considered to have occurred at the
             394      time of the recordation of an amendment to the declaration, executed by the declarant,
             395      containing a legal description by metes and bounds of the land withdrawn from the
             396      condominium project. If portions of the withdrawable land were described pursuant to


             397      Subsection 57-8-10 (5)[(b)(i)](a)(iv), then no described portion may be so withdrawn after the
             398      conveyance of any unit on the portion. If no withdrawable portions were described, then none
             399      of the withdrawable land may be withdrawn after the first conveyance of any unit on the
             400      portion.
             401          Section 4. Section 57-8-13.10 is amended to read:
             402           57-8-13.10. Condominiums containing convertible land -- Expandable
             403      condominiums -- Allocation of interests in common areas and facilities.
             404          (1) If a condominium project contains any convertible land or is an expandable
             405      condominium, then the declaration may not allocate undivided interests in the common areas
             406      and facilities on the basis of par value unless the declaration:
             407          (a) prohibits the creation of any units not substantially identical to the units depicted on
             408      the condominium plat recorded pursuant to Subsection 57-8-13 (1); or
             409          (b) prohibits the creation of any units not described under Subsection
             410      57-8-10 (3)(a)(vii) in the case of convertible land, Subsection 57-8-10 (4)(a)[(xi)](xii) in the
             411      case of additional land, and contains from the outset a statement of the par value that shall be
             412      assigned to every unit that may be created.
             413          (2) (a) Interests in the common areas and facilities may not be allocated to any units to
             414      be created within any convertible land or within any additional land until a condominium plat
             415      depicting the same is recorded pursuant to Subsection 57-8-13 (2).
             416          (b) Simultaneously with the recording of the supplemental condominium plat required
             417      under Subsection (2)(a), the declarant shall execute and record an amendment to the
             418      declaration which reallocates undivided interests in the common areas and facilities so that the
             419      units depicted on the supplemental condominium plat shall be allocated undivided interests in
             420      the common areas and facilities on the same basis as the units depicted on the condominium
             421      plat that was recorded simultaneously with the declaration pursuant to Subsection 57-8-13 (1).
             422          (3) If all of a convertible space is converted into common areas and facilities, including
             423      limited common areas and facilities, then the undivided interest in the common areas and
             424      facilities appertaining to the convertible space shall afterward appertain to the remaining units
             425      and shall be allocated among them in proportion to their undivided interests in the common
             426      areas and facilities. The principal officer of the unit owners' association or of the management
             427      committee, or any other officer specified in the declaration, shall immediately prepare, execute,


             428      and record an amendment to the declaration reflecting the reallocation of undivided interest
             429      produced by the conversion.
             430          (4) (a) If the expiration or termination of any lease of a leasehold condominium causes
             431      a contraction of the condominium project which reduces the number of units, or if the
             432      withdrawal of withdrawable land of a contractible condominium causes a contraction of the
             433      condominium project which reduces the number of units, the undivided interest in the common
             434      areas and facilities appertaining to any units so withdrawn shall afterward appertain to the
             435      remaining units, being allocated among them in proportion to their undivided interests in the
             436      common areas and facilities.
             437          (b) The principal officer of the unit owners' association or of the management
             438      committee, or any other officer specified in the declaration shall immediately prepare, execute,
             439      and record an amendment to the declaration, reflecting the reallocation of undivided interests
             440      produced by the reduction of units.
             441          Section 5. Section 57-8a-209 is amended to read:
             442           57-8a-209. Rental restrictions.
             443          (1) As used in this section, "rentals" or "rental lot" means:
             444          (a) a lot owned by an individual not described in Subsection (1)(b) that is occupied by
             445      someone while no lot owner occupies the lot as the lot owner's primary residence; and
             446          (b) a lot owned by an entity or trust, regardless of who occupies the lot.
             447          (2) (a) Subject to Subsections (2)(b), (6), and (7), an association may:
             448          (i) create restrictions on the number and term of rentals in an association; or
             449          (ii) prohibit rentals in the association.
             450          (b) An association that creates a rental restriction or prohibition in accordance with
             451      Subsection (1)(a)(i) shall create the rental restriction or prohibition in a recorded declaration of
             452      covenants, conditions, and restrictions, or by amending the recorded declaration of covenants,
             453      conditions, and restrictions.
             454          (3) If an association prohibits or imposes restrictions on the number and term of
             455      rentals, the restrictions shall include:
             456          (a) a provision that requires the association to exempt from the rental restrictions the
             457      following lot owner and the lot owner's lot:
             458          (i) a lot owner in the military for the period of the lot owner's deployment;


             459          (ii) a lot occupied by a lot owner's parent, child, or sibling;
             460          (iii) a lot owner whose employer has relocated the lot owner for no less than two years;
             461      or
             462          (iv) a lot owned by a trust or other entity created for estate planning purposes if the
             463      trust or other estate planning entity was created for:
             464          (A) the estate of a current resident of the lot; or
             465          (B) the parent, child, or sibling of the current resident of the lot;
             466          (b) a provision [allowing] that allows a lot owner who has a rental in the association
             467      before the time the rental restriction described in Subsection (2)(a) is recorded with the county
             468      recorder of the county in which the association is located to continue renting until:
             469          (i) the lot owner occupies the lot; or
             470          (ii) an officer, owner, member, trustee, beneficiary, director, or person holding a
             471      similar position of ownership or control of an entity or trust that holds an ownership interest in
             472      the lot, occupies the lot; and
             473          (c) a requirement that the association create, by rule or resolution, procedures to:
             474          (i) determine and track the number of rentals and lots in the association subject to the
             475      provisions described in Subsections (3)(a) and (b); and
             476          (ii) ensure consistent administration and enforcement of the rental restrictions.
             477          (4) For purposes of Subsection (3)(b), a transfer occurs when one or more of the
             478      following occur:
             479          (a) the conveyance, sale, or other transfer of a lot by deed;
             480          (b) the granting of a life estate in the lot; or
             481          (c) if the lot is owned by a limited liability company, corporation, partnership, or other
             482      business entity, the sale or transfer of more than 75% of the business entity's share, stock,
             483      membership interests, or partnership interests in a 12-month period.
             484          (5) This section does not limit or affect residency age requirements for an association
             485      that complies with the requirements of the Housing for Older Persons Act, 42 U.S.C. Sec.
             486      3607.
             487          (6) [The] A declaration of covenants, conditions, and restrictions or amendments to the
             488      declaration of covenants, conditions, and restrictions recorded [prior to] before the transfer of
             489      the first lot from the initial declarant may prohibit or restrict rentals without providing for the


             490      exceptions, provisions, and procedures required under Subsection (3)[(a)].
             491          (7) [This section does] Subsections (2) through (6) do not apply to:
             492          (a) an association [containing] that contains a time period unit as defined in Section
             493      57-8-3 ;
             494          (b) any other form of timeshare interest as defined in Section 57-19-2 ; or
             495          (c) an association in which the initial declaration of covenants, conditions, and
             496      restrictions is recorded before May 12, 2009[.], unless, on or after May 13, 2014, the
             497      association:
             498          (i) adopts a rental restriction or prohibition; or
             499          (ii) amends an existing rental restriction or prohibition.
             500          (8) Notwithstanding this section, an association may, upon unanimous approval by all
             501      lot owners, restrict or prohibit rentals without an exception described in Subsection (3).
             502          (9) Except as provided in Subsection (10), an association may not require a lot owner
             503      who owns a rental lot to:
             504          (a) obtain the association's approval of a prospective renter; or
             505          (b) give the association:
             506          (i) a copy of a rental application;
             507          (ii) a copy of a renter's or prospective renter's credit information or credit report;
             508          (iii) a copy of a renter's or prospective renter's background check; or
             509          (iv) documentation to verify the renter's age.
             510          (10) (a) A lot owner who owns a rental lot shall give an association the documents
             511      described in Subsection (9)(b) if the lot owner is required to provide the documents by court
             512      order or as part of discovery under the Utah Rules of Civil Procedure.
             513          (b) If an association's declaration of covenants, conditions, and restrictions lawfully
             514      prohibits or restricts occupancy of the lots by a certain class of individuals, the association may
             515      require a lot owner who owns a rental lot to give the association the information described in
             516      Subsection (9)(b), if:
             517          (i) the information helps the association determine whether the renter's occupancy of
             518      the lot complies with the association's declaration of covenants, conditions, and restrictions;
             519      and
             520          (ii) the association uses the information to determine whether the renter's occupancy of


             521      the lot complies with the association's declaration of covenants, conditions, and restrictions.
             522          Section 6. Coordinating H.B. 89 with S.B. 147 -- Superseding technical and
             523      substantive amendments.
             524          If this H.B. 89 and S.B. 147, Residential Rental Amendments, both pass and become
             525      law, it is the intent of the Legislature that the amendments to Sections 57-8-10.1 and 57-8a-209
             526      in this bill supersede the amendments to Sections 57-8-10.1 and 57-8a-209 in S.B. 147, when
             527      the Office of Legislative Research and General Counsel prepares the Utah Code database for
             528      publication.


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