[WSBARP] WUCIOA

Wed Jul 25 17:08:31 PDT 2018

Subsection (2) of this section (akaRCW 64.90.080(2)) is what is driving me
crazy.  It says, essentially, that .095 and .525, which, according to
subsection (1), apply to all CICs created before July 1, 2018, only apply to
events occurring after July 1, 2018, except to the extent provided in this
subsection.  Then the next sentence says To protect the public interest, 095
and 525 supersede existing provisions of the governing documents of all plat
communities and miscellaneous communities previously subject to 64.38.  I
read this all together to say, I think, that the method for voting on
budgets set forth in .525 applies to all HOAs, regardless of what your
governing documents say, right?  If so, then what about if your governing
documents contain a method for voting on budgets that was written by a
Superior Court judge?  I had a trial a few months ago where one of the
disputes was the method for voting on budgets and the court ruled that a
majority of the 80 owners had to vote in favor of the budget in order for it
to pass.  Often a majority doesn’t even vote in this community, so I’d love
another bite at that apple.

From: wsbarp-bounces at lists.wsbarppt.com <wsbarp-bounces at lists.wsbarppt.com>
On Behalf Of Rob Wilson-Hoss
Sent: Wednesday, July 25, 2018 8:32 AM
To: 'WSBA Real Property Listserv' <wsbarp at lists.wsbarppt.com>
Subject: Re: [WSBARP] WUCIOA

NEW SECTION. Sec. 117. APPLICABILITY TO PREEXISTING COMMON INTEREST
COMMUNITIES. (1) Except for a nonresidential common interest community
described in section 121 of this act, sections 120 and 326 of this act
apply, and any inconsistent provisions of chapter 59.18, 64.32, 64.34, or
64.38 RCW do not apply, to a common interest community created in this state
before the effective date of this section.

(2) Except to the extent provided in this subsection, the sections listed in
subsection (1) of this section apply only to events and circumstances
occurring after the effective date of this section and do not invalidate
existing provisions of the governing documents of those common interest
communities. To protect the public interest, sections 120 and 326 of this
act supersede existing provisions of the governing documents of all plat
communities and miscellaneous communities previously subject to chapter
64.38 RCW.

120 is the amendment provision that allows amendment to covenants to buy
into the new Act. 326 is the budget/assessment provision. 

Rob

Robert D. Wilson-Hoss 
Hoss & Wilson-Hoss, LLP 
236 West Birch Street 
Shelton, WA 98584 
360 426-2999

www.hossandwilson-hoss.com
 <mailto:rob at hctc.com> rob at hctc.com

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From: wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com>
[mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Paul Neumiller
Sent: Tuesday, July 24, 2018 4:19 PM
To: WSBA Real Property Listserv
Subject: Re: [WSBARP] WUCIOA

Rob, thank you for confirming my suspicions.  I found and read RCW 64.90.525
and 2018 c 277 Sec. 326 regarding the adoption of budgets but I just can’t
find where the legislature made this section applicable to preexisting CICs.
I can see where this section fixes the Casey v. Sudden Valley issue for new
CICs but I don’t see where this new section applies to preexisting CICs
under RCW 64.38.  What am I missing?

From: wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com>
<wsbarp-bounces at lists.wsbarppt.com
<mailto:wsbarp-bounces at lists.wsbarppt.com> > On Behalf Of Rob Wilson-Hoss
Sent: Tuesday, July 24, 2018 3:04 PM
To: 'WSBA Real Property Listserv' <wsbarp at lists.wsbarppt.com
<mailto:wsbarp at lists.wsbarppt.com> >
Subject: Re: [WSBARP] WUCIOA

Paul, what happened is that the proposed Legislation got put into the
blender near the end and it came out quite a mess. Those who worked on it
for years, I think it is fair to say, were not pleased. One of the areas
that got a little crazy was the application to pre-existing CICs, but the
way it worked out, it is pretty clear that it doesn't apply to pre-existings
unless they amend to opt in.

A prior version, to the one that got passed, had a provision that would have
allowed a pre-existing CIC to amend its declaration to allow it to do
anything that could be done under the new Act, sort of a pick and choose
approach. Unfortunately, that got axed and the provision now is, you can
choose to choke on the whole thing, or none of it at all. 

The only piece that is mandatory for pre-existing associations is the
Legislature's answer to Casey v. Sudden Valley, the part about how budgets
(including assessments, duh) get passed. It is slightly different from the
HOA act provision so it is worth a look. Here it is:

NEW SECTION. Sec. 325. ADOPTION OF BUDGETS—ASSESSMENTS AND SPECIAL
ASSESSMENTS. (1)(a) Within thirty days after adoption of any proposed budget
for the common interest community, the board must provide a copy of the
budget to all the unit owners and set a date for a meeting of the unit
owners to consider ratification of the budget not less than fourteen nor
more than fifty days after providing the budget. Unless at that meeting the
unit owners of units to which a majority of the votes in the association are
allocated or any larger percentage specified in the declaration reject the
budget, the budget and the assessments against the units included in the
budget are ratified, whether or not a quorum is present.

(b) If the proposed budget is rejected or the required notice is not given,
the periodic budget last ratified by the unit owners continues until the
unit owners ratify a subsequent budget proposed by the board.

(2) The budget must include:

(a) The projected income to the association by category;

(b) The projected common expenses and those specially allocated expenses
that are subject to being budgeted, both by category;

(c) The amount of the assessments per unit and the date the assessments are
due;

(d) The current amount of regular assessments budgeted for contribution to
the reserve account;

(e) A statement of whether the association has a reserve study that meets
the requirements of section 331 of this act and, if so, the extent to which
the budget meets or deviates from the recommendations of that reserve study;
and

(f) The current deficiency or surplus in reserve funding expressed on a per
unit basis.

(3) The board, at any time, may propose a special assessment. The assessment
is effective only if the board follows the procedures for ratification of a
budget described in subsection (1) of this section and the unit owners do
not reject the proposed assessment. The board may provide that the special
assessment may be due and payable in installments over any period it
determines and may provide a discount for early payment.

I cannot imagine any circumstances where a pre-existing CIC would want to
opt into a 134-page piece of legislation that is primarily notable for the
insane amount of gotcha provisions which would put all smaller associations
at risk on a daily basis, from the "disturbed" members who would hold the
association's feet to the fire on all sorts of minor technicalities. And
major ones that have zero application to small associations. The
administrative burden would be overwhelming. 

I think the powers that be are planning to offer some "technical
corrections" next year, don't know about any seminars. 

Rob

Robert D. Wilson-Hoss 
Hoss & Wilson-Hoss, LLP 
236 West Birch Street 
Shelton, WA 98584 
360 426-2999

<https://nam01.safelinks.protection.outlook.com/?url=www.hossandwilsonhoss.c
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 <mailto:rob at hctc.com> rob at hctc.com

This message is intended solely for the use of the addressee and may contain
information that is privileged, confidential, and exempt from disclosure
under applicable law.  If you are not the addressee, you are hereby notified
that any use, distribution, or copying of this message is strictly
prohibited.  If you received this message in error, please notify us by
reply e-mail or by telephone (call us collect at the number listed above)
and immediately delete this message and any and all of its attachments.
Thank you.

This office does debt collection and this e-mail may be an attempt to
collect a debt, Any information obtained will be used for that purpose.  To
the extent the Federal Fair Debt Collection Practices Act (15 U.S.C. § 1692)
applies this firm is acting as a debt collector for the
condominium/homeowners' association named above to collect a debt owed to
it. Any information obtained will be used for collection purposes. You have
the right to seek advice of legal counsel.

From:  <mailto:wsbarp-bounces at lists.wsbarppt.com>
wsbarp-bounces at lists.wsbarppt.com [
<mailto:wsbarp-bounces at lists.wsbarppt.com>
mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Paul Neumiller
Sent: Tuesday, July 24, 2018 2:24 PM
To:  <mailto:wsbarp at lists.wsbarppt.com> wsbarp at lists.wsbarppt.com
Subject: [WSBARP] WUCIOA

I am assessing the impact of WUCIOA on existing HOAs (under RCW 64.38).  RCW
64.90.095 allows a preexisting CIC to elect to be governed by the new
"Chapter."  Does this mean the whole chapter?  If the answer is yes, then
why would a preexisting HOA ever agree to provide reserve studies (other
than it’s a good idea) and resale certificates and not to mention all of the
changes that would need to be made to the governing documents to come into
compliance with the new Chapter REC 64.90?  Are the powers-that-be preparing
any seminars on this topic?  -Paul Neumiller

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