This document includes House Committee Amendments incorporated into the bill on Wed, Feb 15, 2023 at 1:28 PM by pflowers.
Representative Cheryl K. Acton proposes the following substitute bill:


1     
HOMEOWNERS ASSOCIATION REQUIREMENTS

2     
2023 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Cheryl K. Acton

5     
Senate Sponsor: Todd D. Weiler

6     

7     LONG TITLE
8     General Description:
9          This bill amends provisions related to owners' access to association documents.
10     Highlighted Provisions:
11          This bill:
12          ▸     requires an association of unit owners and a community association to maintain
13     certain records for a period of two years;
14          ▸     requires certain associations of unit owners and community associations to make
15     available certain association documents online or annually provide the documents
16     via electronic mail; and
17          ▸     makes technical and conforming changes.
18     Money Appropriated in this Bill:
19          None
20     Other Special Clauses:
21          None
22     Utah Code Sections Affected:
23     AMENDS:
24          57-8-17, as last amended by Laws of Utah 2022, Chapter 439
25          57-8a-227, as last amended by Laws of Utah 2022, Chapter 439
26     

27     Be it enacted by the Legislature of the state of Utah:
28          Section 1. Section 57-8-17 is amended to read:
29          57-8-17. Records -- Availability for examination.
30          (1) (a) Subject to Subsection (1)(b) and regardless of whether the association of unit
31     owners is incorporated under Title 16, Chapter 6a, Utah Revised Nonprofit Corporation Act, an
32     association of unit owners shall keep and make available to unit owners:
33          (i) each record identified in Subsections 16-6a-1601(1) through (5), in accordance with
34     Sections 16-6a-1601, 16-6a-1602, 16-6a-1603, 16-6a-1605, 16-6a-1606, and 16-6a-1610; [and]
35          (ii) a copy of the association's:
36          (A) governing documents;
37          [(B) most recent approved minutes;]
38          [(C) most recent budget and financial statement;]
39          [(D)] (B) most recent reserve analysis; and
40          [(E)] (C) certificate of insurance for each insurance policy the association of unit
41     owners holds[.]; and
42          (iii) the following documents that are in the association's possession on May 3, 2023,
43     or created on or after May 3, 2023, for at least two years after the day on which the document is
44     created:
45          (A) approved minutes; and
46          (B) budget and financial statement Ĥ→ [.] , including the nature and amount of
46a     expenditures and account balances. ←Ĥ
47          (b) An association of unit owners may redact the following information from any
48     document the association of unit owners produces for inspection or copying:
49          (i) a Social Security number;
50          (ii) a bank account number; or
51          (iii) any communication subject to attorney-client privilege.
52          (2) (a) In addition to the requirements described in Subsection (1), an association of
53     unit owners shall:
54          (i) make documents available to unit owners in accordance with the association of unit
55     owners' governing documents; and
56          (ii) (A) if the association of unit owners contains 20 or more units:
57          (I) make available online the documents described in Subsections (1)(a)(ii)(A) and
58     (1)(a)(iii) to unit owners, free of charge; or
59          (II) send the documents described in Subsections (1)(a)(ii)(A) and 1(a)(iii) to unit
60     owners via electronic mail on an annual basis;
61          (B) regardless of the number of units in the association, if the association of unit
62     owners has an active website, make the documents described in Subsections (1)(a)(ii)(A)
63     [through (C)] and (1)(a)(iii) available to unit owners, free of charge, through the website; or
64          [(B)] (C) if the association of unit owners does not have an active website and contains
65     fewer than 20 units, make physical copies of the documents described in Subsections
66     (1)(a)(ii)(A) [through (C)] and (1)(a)(iii) available to unit owners during regular business hours
67     at the association of unit owners' address registered with the Department of Commerce under
68     Section 57-8-13.1.
69          (b) For purposes of Subsection (2)(a)(ii)(A), making documents available online may
70     include making documents available through the association's website.
71          [(b)] (c) Subsection (2)(a)(ii) does not apply to an association as defined in Section
72     57-19-2.
73          [(c)] (d) If a provision of an association of unit owners' governing documents conflicts
74     with a provision of this section, the provision of this section governs.
75          (3) In a written request to inspect or copy documents:
76          (a) a unit owner shall include:
77          (i) the association of unit owners' name;
78          (ii) the unit owner's name;
79          (iii) the unit owner's property address;
80          (iv) the unit owner's email address;
81          (v) a description of the documents requested; and
82          (vi) any election or request described in Subsection (3)(b); and
83          (b) a unit owner may:
84          (i) elect whether to inspect or copy the documents;
85          (ii) if the unit owner elects to copy the documents, request hard copies or electronic
86     scans of the documents; or
87          (iii) subject to Subsection (4), request that:
88          (A) the association of unit owners make the copies or electronic scans of the requested
89     documents;
90          (B) a recognized third party duplicating service make the copies or electronic scans of
91     the requested documents;
92          (C) the unit owner be allowed to bring any necessary imaging equipment to the place
93     of inspection and make copies or electronic scans of the documents while inspecting the
94     documents; or
95          (D) the association of unit owners email the requested documents to an email address
96     provided in the request.
97          (4) (a) An association of unit owners shall comply with a request described in
98     Subsection (3).
99          (b) If an association of unit owners produces the copies or electronic scans:
100          (i) the copies or electronic scans shall be legible and accurate; and
101          (ii) the unit owner shall pay the association of unit owners the reasonable cost of the
102     copies or electronic scans and for time spent meeting with the unit owner, which may not
103     exceed:
104          (A) the actual cost that the association of unit owners paid to a recognized third party
105     duplicating service to make the copies or electronic scans; or
106          (B) 10 cents per page and $15 per hour for the employee's, manager's, or other agent's
107     time making the copies or electronic scans.
108          (c) If a unit owner requests a recognized third party duplicating service make the copies
109     or electronic scans:
110          (i) the association of unit owners shall arrange for the delivery and pick up of the
111     original documents; and
112          (ii) the unit owner shall pay the duplicating service directly.
113          (d) Subject to Subsection (9), if a unit owner requests to bring imaging equipment to
114     the inspection, the association of unit owners shall provide the necessary space, light, and
115     power for the imaging equipment.
116          (5) If, in response to a unit owner's request to inspect or copy documents, an
117     association of unit owners fails to comply with a provision of this section, the association of
118     unit owners shall pay:
119          (a) the reasonable costs of inspecting and copying the requested documents;
120          (b) for items described in Subsections (1)(a)(ii)(A) [through (C)] and (1)(a)(iii), $25 to
121     the unit owner who made the request for each day the request continues unfulfilled, beginning
122     the sixth day after the day on which the unit owner made the request; and
123          (c) reasonable attorney fees and costs incurred by the unit owner in obtaining the
124     inspection and copies of the requested documents.
125          (6) (a) In addition to any remedy in the association of unit owners' governing
126     documents or as otherwise provided by law, a unit owner may file an action in court under this
127     section if:
128          (i) subject to Subsection (9), an association of unit owners fails to make documents
129     available to the unit owner in accordance with this section, the association of unit owners'
130     governing documents, or as otherwise provided by law; and
131          (ii) the association of unit owners fails to timely comply with a notice described in
132     Subsection (6)(d).
133          (b) In an action described in Subsection (6)(a):
134          (i) the unit owner may request:
135          (A) injunctive relief requiring the association of unit owners to comply with the
136     provisions of this section;
137          (B) $500 or actual damage, whichever is greater; or
138          (C) any other relief provided by law; and
139          (ii) the court shall award costs and reasonable attorney fees to the prevailing party,
140     including any reasonable attorney fees incurred before the action was filed that relate to the
141     request that is the subject of the action.
142          (c) (i) In an action described in Subsection (6)(a), upon motion by the unit owner,
143     notice to the association of unit owners, and a hearing in which the court finds a likelihood that
144     the association of unit owners failed to comply with a provision of this section, the court shall
145     order the association of unit owners to immediately comply with the provision.
146          (ii) The court shall hold a hearing described in Subsection (6)(c)(i) within 30 days after
147     the day on which the unit owner files the motion.
148          (d) At least 10 days before the day on which a unit owner files an action described in
149     Subsection (6)(a), the unit owner shall deliver a written notice to the association of unit owners
150     that states:
151          (i) the unit owner's name, address, telephone number, and email address;
152          (ii) each requirement of this section with which the association of unit owners has
153     failed to comply;
154          (iii) a demand that the association of unit owners comply with each requirement with
155     which the association of unit owners has failed to comply; and
156          (iv) a date by which the association of unit owners shall remedy the association of unit
157     owners' noncompliance that is at least 10 days after the day on which the unit owner delivers
158     the notice to the association of unit owners.
159          (7) (a) The provisions of Section 16-6a-1604 do not apply to an association of unit
160     owners.
161          (b) The provisions of this section apply regardless of any conflicting provision in Title
162     16, Chapter 6a, Utah Revised Nonprofit Corporation Act.
163          (8) A unit owner's agent may, on the unit owner's behalf, exercise or assert any right
164     that the unit owner has under this section.
165          (9) An association of unit owners is not liable for identifying or providing a document
166     in error, if the association of unit owners identified or provided the erroneous document in
167     good faith.
168          Section 2. Section 57-8a-227 is amended to read:
169          57-8a-227. Records -- Availability for examination.
170          (1) (a) Subject to Subsection (1)(b) and regardless of whether the association is
171     incorporated under Title 16, Chapter 6a, Utah Revised Nonprofit Corporation Act, an
172     association shall keep and make available to lot owners:
173          (i) each record identified in Subsections 16-6a-1601(1) through (5), in accordance with
174     Sections 16-6a-1601, 16-6a-1602, 16-6a-1603, 16-6a-1605, 16-6a-1606, and 16-6a-1610; and
175          (ii) a copy of the association's:
176          (A) governing documents;
177          [(B) most recent approved minutes;]
178          [(C) most recent budget and financial statement;]
179          [(D)] (B) most recent reserve analysis; and
180          [(E)] (C) certificate of insurance for each insurance policy the association holds[.]; and
181          (iii) the following documents that are in the association's possession on May 3, 2023,
182     or created on or after May 3, 2023, for at least two years after the day on which the document is
183     created:
184          (A) approved minutes; and
185          (B) budget and financial statement Ĥ→ [.] , including the nature and amount of
185a     expenditures and account balances. ←Ĥ
186          (b) An association may redact the following information from any document the
187     association produces for inspection or copying:
188          (i) a Social Security number;
189          (ii) a bank account number; or
190          (iii) any communication subject to attorney-client privilege.
191          (2) (a) In addition to the requirements described in Subsection (1), an association shall:
192          (i) make documents available to lot owners in accordance with the association's
193     governing documents; and
194          (ii) (A) if the association contains 20 or more lots:
195          (I) make available online the documents described in Subsections (1)(a)(ii)(A) and
196     (1)(a)(iii) to lot owners, free of charge; or
197          (II) send the documents described in Subsections (1)(a)(ii)(A) and (1)(a)(iii) to lot
198     owners via electronic mail on an annual basis;
199          [(A)] (B) regardless of the number of lots in the association, if the association has an
200     active website, make the documents described in Subsections (1)(a)(ii)(A) [through (C)] and
201     (1)(a)(iii) available to lot owners, free of charge, through the website; or
202          [(B)] (C) if the association does not have an active website and contains fewer than 20
203     lots, make physical copies of the documents described in Subsections (1)(a)(ii)(A) [through
204     (C)] and (1)(a)(iii) available to lot owners during regular business hours at the association's
205     address registered with the Department of Commerce under Section 57-8a-105.
206          (b) For purposes of Subsection (2)(a)(ii)(A), making documents available online may
207     include making documents available through the association's website.
208          (c) Subsection (2)(a)(ii) does not apply to an association as defined in Section 57-19-2.
209          [(c)] (d) If a provision of an association's governing documents conflicts with a
210     provision of this section, the provision of this section governs.
211          (3) In a written request to inspect or copy documents:
212          (a) a lot owner shall include:
213          (i) the association's name;
214          (ii) the lot owner's name;
215          (iii) the lot owner's property address;
216          (iv) the lot owner's email address;
217          (v) a description of the documents requested; and
218          (vi) any election or request described in Subsection (3)(b); and
219          (b) a lot owner may:
220          (i) elect whether to inspect or copy the documents;
221          (ii) if the lot owner elects to copy the documents, request hard copies or electronic
222     scans of the documents; or
223          (iii) subject to Subsection (4), request that:
224          (A) the association make the copies or electronic scans of the requested documents;
225          (B) a recognized third party duplicating service make the copies or electronic scans of
226     the requested documents;
227          (C) the lot owner be allowed to bring any necessary imaging equipment to the place of
228     inspection and make copies or electronic scans of the documents while inspecting the
229     documents; or
230          (D) the association email the requested documents to an email address provided in the
231     request.
232          (4) (a) An association shall comply with a request described in Subsection (3).
233          (b) If an association produces the copies or electronic scans:
234          (i) the copies or electronic scans shall be legible and accurate; and
235          (ii) the lot owner shall pay the association the reasonable cost of the copies or
236     electronic scans and for time spent meeting with the lot owner, which may not exceed:
237          (A) the actual cost that the association paid to a recognized third party duplicating
238     service to make the copies or electronic scans; or
239          (B) 10 cents per page and $15 per hour for the employee's, manager's, or other agent's
240     time.
241          (c) If a lot owner requests a recognized third party duplicating service make the copies
242     or electronic scans:
243          (i) the association shall arrange for the delivery and pick up of the original documents;
244     and
245          (ii) the lot owner shall pay the duplicating service directly.
246          (d) If a lot owner requests to bring imaging equipment to the inspection, the association
247     shall provide the necessary space, light, and power for the imaging equipment.
248          (5) Subject to Subsection (9), if, in response to a lot owner's request to inspect or copy
249     documents, an association fails to comply with a provision of this section, the association shall
250     pay:
251          (a) the reasonable costs of inspecting and copying the requested documents;
252          (b) for items described in Subsections (1)(a)(ii)(A) [through (C)] and (1)(a)(iii), $25 to
253     the lot owner who made the request for each day the request continues unfulfilled, beginning
254     the sixth day after the day on which the lot owner made the request; and
255          (c) reasonable attorney fees and costs incurred by the lot owner in obtaining the
256     inspection and copies of the requested documents.
257          (6) (a) In addition to any remedy in the association's governing documents or otherwise
258     provided by law, a lot owner may file an action in court under this section if:
259          (i) subject to Subsection (9), an association fails to make documents available to the lot
260     owner in accordance with this section, the association's governing documents, or as otherwise
261     provided by law; and
262          (ii) the association fails to timely comply with a notice described in Subsection (6)(d).
263          (b) In an action described in Subsection (6)(a):
264          (i) the lot owner may request:
265          (A) injunctive relief requiring the association to comply with the provisions of this
266     section;
267          (B) $500 or actual damage, whichever is greater; or
268          (C) any other relief provided by law; and
269          (ii) the court shall award costs and reasonable attorney fees to the prevailing party,
270     including any reasonable attorney fees incurred before the action was filed that relate to the
271     request that is the subject of the action.
272          (c) (i) In an action described in Subsection (6)(a), upon motion by the lot owner, notice
273     to the association, and a hearing in which the court finds a likelihood that the association failed
274     to comply with a provision of this section, the court shall order the association to immediately
275     comply with the provision.
276          (ii) The court shall hold a hearing described in Subsection (6)(c)(i) within 30 days after
277     the day on which the lot owner files the motion.
278          (d) At least 10 days before the day on which a lot owner files an action described in
279     Subsection (6)(a), the lot owner shall deliver a written notice to the association that states:
280          (i) the lot owner's name, address, telephone number, and email address;
281          (ii) each requirement of this section with which the association has failed to comply;
282          (iii) a demand that the association comply with each requirement with which the
283     association has failed to comply; and
284          (iv) a date by which the association shall remedy the association's noncompliance that
285     is at least 10 days after the day on which the lot owner delivers the notice to the association.
286          (7) (a) The provisions of Section 16-6a-1604 do not apply to an association.
287          (b) The provisions of this section apply regardless of any conflicting provision in Title
288     16, Chapter 6a, Utah Revised Nonprofit Corporation Act.
289          (8) A lot owner's agent may, on the lot owner's behalf, exercise or assert any right that
290     the lot owner has under this section.
291          (9) An association is not liable for identifying or providing a document in error, if the
292     association identified or provided the erroneous document in good faith.