Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 454 First Substitute (2018GS)

Sponsor

Rep. Froerer, G.

Final action

Governor Signed 3/21/2018

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• enacts provisions regarding a management committee that imposes sanctions or pursues legal action;
• establishes that a management committee acts for an association of unit owners;
• regulates how an association of unit owners and an association may handle association funds;
• amends provisions regarding a management committee and a board's use of money in a reserve fund;
• amends provisions related to rental restrictions;
• enacts provisions requiring a lot owner to comply with the governing documents of an association;
• requires an association of unit owners and an association to make certain documents available to unit and lot owners:
• free of charge, through the association of unit owners' or association's website; or
• at the association of unit owners' or association's address;
• requires a unit or lot owner to include certain information in a written request for documentation;
• establishes a penalty for the failure of an association of unit owners or an association to fulfill a request;
• provides that an association of unit owners or an association is not liable for erroneous documents identified or produced in good faith; and
• makes technical and conforming changes.

Every vote on this bill

Bill text

HOMEOWNERS ASSOCIATION MODIFICATIONS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Gage Froerer
Senate Sponsor: 
J. Stuart Adams
LONG TITLE
General Description:
This bill amends provisions of the Condominium Ownership Act and the Community
Association Act.
Highlighted Provisions:
This bill:
▸ enacts provisions regarding a management committee that imposes sanctions or
pursues legal action;
▸ establishes that a management committee acts for an association of unit owners;
▸ regulates how an association of unit owners and an association may handle
association funds;
▸ amends provisions regarding a management committee and a board's use of money
in a reserve fund;
▸ amends provisions related to rental restrictions;
▸ enacts provisions requiring a lot owner to comply with the governing documents of
an association;
▸ requires an association of unit owners and an association to make certain documents
available to unit and lot owners:
• free of charge, through the association of unit owners' or association's website;
or
• at the association of unit owners' or association's address;
▸ requires a unit or lot owner to include certain information in a written request for
documentation;
▸ establishes a penalty for the failure of an association of unit owners or an
association to fulfill a request;
▸ provides that an association of unit owners or an association is not liable for
erroneous documents identified or produced in good faith; and
▸ makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
57-8-7.5
, as last amended by Laws of Utah 2015, Chapters 34 and 325
57-8-10.1
, as last amended by Laws of Utah 2017, Chapter 131
57-8-17
, as repealed and reenacted by Laws of Utah 2015, Chapter 325
57-8a-209
, as last amended by Laws of Utah 2017, Chapter 131
57-8a-211
, as last amended by Laws of Utah 2015, Chapter 34
57-8a-227
, as enacted by Laws of Utah 2015, Chapter 325
ENACTS:
57-8-10.7
, Utah Code Annotated 1953
57-8-59
, Utah Code Annotated 1953
57-8-60
, Utah Code Annotated 1953
57-8a-212.5
, Utah Code Annotated 1953
57-8a-230
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
57-8-7.5
 is amended to read:
57-8-7.5.
Reserve analysis -- Reserve fund.
(1) As used in this section:
(a) "Reserve analysis" means an analysis to determine:
(i) the need for a reserve fund to accumulate reserve funds; and
(ii) the appropriate amount of any reserve fund.
(b) "Reserve fund line item" means the line item in an association of unit owners'
annual budget that identifies the amount to be placed into a reserve fund.
(c) "Reserve funds" means money to cover the cost of repairing, replacing, or restoring
common areas and facilities that have a useful life of three years or more and a remaining
useful life of less than 30 years, if the cost cannot reasonably be funded from the general
budget or other funds of the association of unit owners.
(2) Except as otherwise provided in the declaration, a management committee shall:
(a) cause a reserve analysis to be conducted no less frequently than every six years; and
(b) review and, if necessary, update a previously conducted reserve analysis no less
frequently than every three years.
(3) The management committee may conduct a reserve analysis itself or may engage a
reliable person or organization, as determined by the management committee, to conduct the
reserve analysis.
(4) A reserve fund analysis shall include:
(a) a list of the components identified in the reserve analysis that will reasonably
require reserve funds;
(b) a statement of the probable remaining useful life, as of the date of the reserve
analysis, of each component identified in the reserve analysis;
(c) an estimate of the cost to repair, replace, or restore each component identified in the
reserve analysis;
(d) an estimate of the total annual contribution to a reserve fund necessary to meet the
cost to repair, replace, or restore each component identified in the reserve analysis during the
component's useful life and at the end of the component's useful life; and
(e) a reserve funding plan that recommends how the association of unit owners may
fund the annual contribution described in Subsection (4)(d).
(5) An association of unit owners shall:
(a) annually provide unit owners a summary of the most recent reserve analysis or
update; and
(b) provide a copy of the complete reserve analysis or update to a unit owner who
requests a copy.
(6) In formulating [
its
] 
the association of unit owners'
 budget each year, an association
of unit owners shall include a reserve fund line item in:
(a) an amount the management committee determines, based on the reserve analysis, to
be prudent; or
(b) an amount required by the declaration, if the declaration requires an amount higher
than the amount determined under Subsection (6)(a).
(7) (a) Within 45 days after the day on which an association of unit owners adopts [
its
]
the association of unit owners'
 annual budget, the unit owners may veto the reserve fund line
item by a 51% vote of the allocated voting interests in the association of unit owners at a
special meeting called by the unit owners for the purpose of voting whether to veto a reserve
fund line item.
(b) If the unit owners veto a reserve fund line item under Subsection (7)(a) and a
reserve fund line item exists in a previously approved annual budget of the association of unit
owners that was not vetoed, the association of unit owners shall fund the reserve account in
accordance with that prior reserve fund line item.
(8) (a) Subject to Subsection (8)(b), if an association of unit owners does not comply
with the requirements of Subsection (5), (6), or (7) and fails to remedy the noncompliance
within the time specified in Subsection (8)(c), a unit owner may file an action in state court for:
(i) injunctive relief requiring the association of unit owners to comply with the
requirements of Subsection (5), (6), or (7);
(ii) $500 or actual damages, whichever is greater;
(iii) any other remedy provided by law; and
(iv) reasonable costs and attorney fees.
(b) No fewer than 90 days before the day on which a unit owner files a complaint under
Subsection (8)(a), the unit owner shall deliver written notice described in Subsection (8)(c) to
the association of unit owners.
(c) A notice under Subsection (8)(b) shall state:
(i) the requirement in Subsection (5), (6), or (7) with which the association of unit
owners has failed to comply;
(ii) a demand that the association of unit owners come into compliance with the
requirements; and
(iii) a date, no fewer than 90 days after the day on which the unit owner delivers the
notice, by which the association of unit owners shall remedy its noncompliance.
(d) In a case filed under Subsection (8)(a), a court may order an association of unit
owners to produce the summary of the reserve analysis or the complete reserve analysis on an
expedited basis and at the association of unit owners' expense.
(9) (a) [
A
] 
Unless a majority of the members of the association of unit owners vote to
approve the use of reserve fund money for that purpose, a
 management committee may not use
money in a reserve fund:
(i) for daily maintenance expenses[
, unless a majority of the members of the
association of unit owners vote to approve the use of reserve fund money for that purpose
]; or
(ii) for any purpose other than the purpose for which the reserve fund was established.
(b) A management committee shall maintain a reserve fund separate from other funds
of the association of unit owners.
(c) This Subsection (9) may not be construed to limit a management committee from
prudently investing money in a reserve fund, subject to any investment constraints imposed by
the declaration.
(10) Subsections (2) through (9) do not apply to an association of unit owners during
the period of administrative control.
(11) For a condominium project whose initial declaration is recorded on or after May
12, 2015, during the period of administrative control, for any property that the declarant sells to
a third party, the declarant shall give the third party:
(a) a copy of the association of unit owners' governing documents; and
(b) a copy of the association of unit owners' most recent financial statement that
includes any reserve funds held by the association of unit owners or by a subsidiary of the
association of unit owners.
(12) Except as otherwise provided in this section, this section applies to each
association of unit owners, regardless of when the association of unit owners was created.
Section 2. Section 
57-8-10.1
 is amended to read:
57-8-10.1.
Rental restrictions.
(1) (a) Subject to Subsections (1)(b), (5), and (6), an association of unit owners may:
(i) create restrictions on the number and term of rentals in a condominium project; or
(ii) prohibit rentals in the condominium project.
(b) An association of unit owners that creates a rental restriction or prohibition in
accordance with Subsection (1)(a) shall create the rental restriction or prohibition in a
declaration or by amending the declaration.
(2) If an association of unit owners prohibits or imposes restrictions on the number and
term of rentals, the restrictions shall include:
(a) a provision that requires a condominium project to exempt from the rental
restrictions the following unit owner and the unit owner's unit:
(i) a unit owner in the military for the period of the unit owner's deployment;
(ii) a unit occupied by a unit owner's parent, child, or sibling;
(iii) a unit owner whose employer has relocated the unit owner for [
no less than
] two
years 
or less
;
(iv) a unit owned by an entity that is occupied by an individual who:
(A) has voting rights under the entity's organizing documents; and
(B) has a 25% or greater share of ownership, control, and right to profits and losses of
the entity; or 
(v) a unit owned by a trust or other entity created for estate planning purposes if the
trust or other estate planning entity was created for the estate of:
(A) a current resident of the unit; or
(B) the parent, child, or sibling of the current resident of the unit;
(b) a provision that allows a unit owner who has a rental in the condominium project
before the time the rental restriction described in Subsection (1)(a) is recorded with the county
recorder of the county in which the condominium project is located to continue renting until:
(i) the unit owner occupies the unit; [
or
]
(ii) an officer, owner, member, trustee, beneficiary, director, or person holding a
similar position of ownership or control of an entity or trust that holds an ownership interest in
the unit, occupies the unit; [
and
] 
or
(iii) the unit is transferred; and
(c) a requirement that the association of unit owners create, by rule or resolution,
procedures to:
(i) determine and track the number of rentals and units in the condominium project
subject to the provisions described in Subsections (2)(a) and (b); and
(ii) ensure consistent administration and enforcement of the rental restrictions.
(3) For purposes of Subsection (2)(b)
(iii)
, a transfer occurs when one or more of the
following occur:
(a) the conveyance, sale, or other transfer of a unit by deed;
(b) the granting of a life estate in the unit; or
(c) if the unit is owned by a limited liability company, corporation, partnership, or
other business entity, the sale or transfer of more than 75% of the business entity's share, stock,
membership interests, or partnership interests in a 12-month period.
(4) This section does not limit or affect residency age requirements for an association
of unit owners that complies with the requirements of the Housing for Older Persons Act, 42
U.S.C. Sec. 3607.
(5) A declaration or amendment to a declaration recorded before transfer of the first
unit from the initial declarant may prohibit or restrict rentals without providing for the
exceptions, provisions, and procedures required under Subsection (2).
(6) (a) Subsections (1) through (5) do not apply to:
(i) a condominium project that contains a time period unit as defined in Section 
57-8-3
;
(ii) any other form of timeshare interest as defined in Section 
57-19-2
; or
(iii) subject to Subsection (6)(b), a condominium project in which the initial
declaration is recorded before May 12, 2009, unless, on or after May 12, 2015, the association
of unit owners:
(A) adopts a rental restriction or prohibition; or
(B) amends an existing rental restriction or prohibition.
(b) An association that adopts a rental restriction or amends an existing rental
restriction or prohibition before May 9, 2017, is not required to include the exemption
described in Subsection (2)(a)(iv).
(7) Notwithstanding this section, an association of unit owners may restrict or prohibit
rentals without an exception described in Subsection (2) if:
(a) the restriction or prohibition receives unanimous approval by all unit owners; and
(b) when the restriction or prohibition requires an amendment to the association of unit
owners' declaration, the association of unit owners fulfills all other requirements for amending
the declaration described in the association of unit owners' governing documents.
(8) Except as provided in Subsection (9), an association of unit owners may not require
a unit owner who owns a rental unit to:
(a) obtain the association of unit owners' approval of a prospective renter;
(b) give the association of unit owners:
(i) a copy of a rental application;
(ii) a copy of a renter's or prospective renter's credit information or credit report;
(iii) a copy of a renter's or prospective renter's background check; or
(iv) documentation to verify the renter's age; or
(c) pay an additional assessment, fine, or fee because the unit is a rental unit.
(9) (a) A unit owner who owns a rental unit shall give an association of unit owners the
documents described in Subsection (8)(b) if the unit owner is required to provide the
documents by court order or as part of discovery under the Utah Rules of Civil Procedure.
(b) If an association of unit owners' declaration lawfully prohibits or restricts
occupancy of the units by a certain class of individuals, the association of unit owners may
require a unit owner who owns a rental unit to give the association of unit owners the
information described in Subsection (8)(b), if:
(i) the information helps the association of unit owners determine whether the renter's
occupancy of the unit complies with the association of unit owners' declaration; and
(ii) the association of unit owners uses the information to determine whether the
renter's occupancy of the unit complies with the association of unit owners' declaration.
(10) The provisions of Subsections (8) and (9) apply to an association of unit owners
regardless of when the association of unit owners is created.
Section 3. Section 
57-8-10.7
 is enacted to read:
 57-8-10.7.
Board action to enforce governing documents -- Parameters.
(1) (a) The management committee shall use the management committee's reasonable
judgment to determine whether to exercise the association of unit owners' powers to impose
sanctions or pursue legal action for a violation of the governing documents, including:
(i) whether to compromise a claim made by or against the management committee or
the association of unit owners; and
(ii) whether to pursue a claim for an unpaid assessment.
(b) The association of unit owners may not be required to take enforcement action if
the management committee determines, after fair review and acting in good faith and without
conflict of interest, that under the particular circumstances:
(i) the association of unit owners' legal position does not justify taking any or further
enforcement action;
(ii) the covenant, restriction, or rule in the governing documents is likely to be
construed as inconsistent with current law;
(iii) (A) a technical violation has or may have occurred; and
(B) the violation is not material as to a reasonable person or does not justify expending
the association of unit owners' resources; or
(iv) it is not in the association of unit owners' best interests to pursue an enforcement
action, based upon hardship, expense, or other reasonable criteria.
(2) Subject to Subsection (3), if the management committee decides under Subsection
(1)(b) to forego enforcement, the association of unit owners is not prevented from later taking
enforcement action.
(3) The management committee may not be arbitrary, capricious, or act against public
policy in taking or not taking enforcement action.
(4) This section does not govern whether the association of unit owners' action in
enforcing a provision of the governing documents constitutes a waiver or modification of that
provision.
Section 4. Section 
57-8-17
 is amended to read:
57-8-17.
Records -- Availability for examination.
(1) (a) Subject to Subsection (1)(b), an association of unit owners shall keep and make
documents available to unit owners in accordance with Sections 
16-6a-1601
 through 1603,
16-6a-1605
, 
16-6a-1606
, and 
16-6a-1610
[
,
]
:
(i)
 regardless of whether the association of unit owners is incorporated under Title 16,
Chapter 6a, Utah Revised Nonprofit Corporation Act[
.
]
; and
(ii) including keeping and making available to unit owners a copy of the association of
unit owners':
(A) declaration and bylaws;
(B) most recent approved minutes; and
(C) most recent budget and financial statement.
(b) An association of unit owners may redact the following information from any
document the association of unit owners produces for inspection or copying:
(i) a Social Security number;
(ii) a bank account number; or
(iii) any communication subject to attorney-client privilege.
(2) (a) In addition to the requirements described in Subsection (1), an association of
unit owners shall
:
(i)
 make documents available to unit owners in accordance with the association of unit
owners' governing documents[
.
]
; and
(ii) (A) if the association of unit owners has an active website, make the documents
described in Subsection (1)(a)(ii) available to unit owners, free of charge, through the website;
or
(B) if the association of unit owners does not have an active website, make physical
copies of the documents described in Subsection (1)(a)(ii) available to unit owners during
regular business hours at the association of unit owners' address registered with the Department
of Commerce under Section 
57-8-13.1
.
(b) Subsection (2)(a)(ii) does not apply to an association as defined in Section 
57-19-2
.
[
(b)
] 
(c)
 If a provision of an association of unit owners' governing documents conflicts
with a provision of this section, the provision of this section governs.
(3) In a 
written
 request to inspect or copy documents[
,
]
:
(a) a unit owner shall include:
(i) the association of unit owners' name;
(ii) the unit owner's name;
(iii) the unit owner's property address;
(iv) the unit owner's email address;
(v) a description of the documents requested; and
(vi) any election or request described in Subsection (3)(b); and
(b)
 a unit owner may:
[
(a)
] 
(i)
 elect whether to inspect or copy the documents;
[
(b)
] 
(ii)
 if the unit owner elects to copy the documents, request hard copies or
electronic scans of the documents; or
[
(c)
] 
(iii)
 subject to Subsection (4), request that:
[
(i)
] 
(A)
 the association of unit owners make the copies or electronic scans of the
requested documents;
[
(ii)
] 
(B)
 a recognized third party duplicating service make the copies or electronic
scans of the requested documents; [
or
]
[
(iii)
] 
(C)
 the unit owner be allowed to bring any necessary imaging equipment to the
place of inspection and make copies or electronic scans of the documents while inspecting the
documents[
.
]
; or
(D) the association of unit owners email the requested documents to an email address
provided in the request.
(4) (a) An association of unit owners shall comply with a request described in
Subsection (3).
(b) If an association of unit owners produces the copies or electronic scans:
(i) the copies or electronic scans shall be legible and accurate; and
(ii) the unit owner shall pay the association of unit owners the reasonable cost of the
copies or electronic scans 
and for time spent meeting with the unit owner
, which may not
exceed:
(A) the actual cost that the association of unit owners paid to a recognized third party
duplicating service to make the copies or electronic scans; or
(B) [
if an employee, manager, or other agent of the association of unit owners makes
the copies or electronic scans,
] 10 cents per page and $15 per hour for the employee's,
manager's, or other agent's time making the copies or electronic scans.
(c) If a unit owner requests a recognized third party duplicating service make the copies
or electronic scans:
(i) the association of unit owners shall arrange for the delivery and pick up of the
original documents; and
(ii) the unit owner shall pay the duplicating service directly.
(d) [
If
] 
Subject to Subsection (9), if
 a unit owner requests to bring imaging equipment
to the inspection, the association of unit owners shall provide the necessary space, light, and
power for the imaging equipment.
(5) If, in response to a unit owner's request to inspect or copy documents, an
association of unit owners fails to comply with a provision of this section, the association of
unit owners shall pay:
(a) the reasonable costs of inspecting and copying the requested documents; [
and
]
(b) for items described in Subsection (1)(a)(ii), $25 to the unit owner who made the
request for each day the request continues unfulfilled, beginning the sixth day after the day on
which the unit owner made the request; and
[
(b)
] 
(c)
 reasonable attorney fees and costs incurred by the unit owner in obtaining the
inspection and copies of the requested documents.
(6) (a) In addition to any remedy in the association of unit owners' governing
documents or as otherwise provided by law, a unit owner may file an action in court under this
section if:
(i) 
subject to Subsection (9),
 an association of unit owners fails to make documents
available to the unit owner in accordance with this section, the association of unit owners'
governing documents, or as otherwise provided by law; and
(ii) the association of unit owners fails to timely comply with a notice described in
Subsection (6)(d).
(b) In an action described in Subsection (6)(a):
(i) the unit owner may request:
(A) injunctive relief requiring the association of unit owners to comply with the
provisions of this section;
(B) $500 or actual damage, whichever is greater; or
(C) any other relief provided by law; and
(ii) the court shall award costs and reasonable attorney fees to the prevailing party,
including any reasonable attorney fees incurred before the action was filed that relate to the
request that is the subject of the action.
(c) (i) In an action described in Subsection (6)(a), upon motion by the unit owner,
notice to the association of unit owners, and a hearing in which the court finds a likelihood that
the association of unit owners failed to comply with a provision of this section, the court shall
order the association of unit owners to immediately comply with the provision.
(ii) The court shall hold a hearing described in Subsection (6)(c)(i) within 30 days after
the day on which the unit owner files the motion.
(d) At least 10 days before the day on which a unit owner files an action described in
Subsection (6)(a), the unit owner shall deliver a written notice to the association of unit owners
that states:
(i) the unit owner's name, address, telephone number, and email address;
(ii) each requirement of this section with which the association of unit owners has
failed to comply;
(iii) a demand that the association of unit owners comply with each requirement with
which the association of unit owners has failed to comply; and
(iv) a date by which the association of unit owners shall remedy the association of unit
owners' noncompliance that is at least 10 days after the day on which the unit owner delivers
the notice to the association of unit owners.
(7) (a) The provisions of Section 
16-6a-1604
 do not apply to an association of unit
owners.
(b) The provisions of this section apply regardless of any conflicting provision in Title
16, Chapter 6a, Utah Revised Nonprofit Corporation Act.
(8) A unit owner's agent may, on the unit owner's behalf, exercise or assert any right
that the unit owner has under this section.
(9) An association of unit owners is not liable for identifying or providing a document
in error, if the association of unit owners identified or provided the erroneous document in
good faith.
Section 5. Section 
57-8-59
 is enacted to read:
 57-8-59.
Management committee act for association of unit owners.
Except as limited in the declaration, the association of unit owners bylaws or articles of
incorporation, or other provisions of this chapter, a management committee acts in all instances
on behalf of the association of unit owners.
Section 6. Section 
57-8-60
 is enacted to read:
 57-8-60.
Administration of funds.
An association of unit owners:
(1) shall keep all of the association of unit owners' funds in an account in the name of
the association of unit owners; and
(2) may not commingle the association of unit owners' funds with the funds of any
other person.
Section 7. Section 
57-8a-209
 is amended to read:
57-8a-209.
Rental restrictions.
(1) (a) Subject to Subsections (1)(b), (5), and (6), an association may:
(i) create restrictions on the number and term of rentals in an association; or
(ii) prohibit rentals in the association.
(b) An association that creates a rental restriction or prohibition in accordance with
Subsection (1)(a) shall create the rental restriction or prohibition in a recorded declaration of
covenants, conditions, and restrictions, or by amending the recorded declaration of covenants,
conditions, and restrictions.
(2) If an association prohibits or imposes restrictions on the number and term of
rentals, the restrictions shall include:
(a) a provision that requires the association to exempt from the rental restrictions the
following lot owner and the lot owner's lot:
(i) a lot owner in the military for the period of the lot owner's deployment;
(ii) a lot occupied by a lot owner's parent, child, or sibling;
(iii) a lot owner whose employer has relocated the lot owner for [
no less than
] two
years 
or less
;
(iv) a lot owned by an entity that is occupied by an individual who:
(A) has voting rights under the entity's organizing documents; and
(B) has a 25% or greater share of ownership, control, and right to profits and losses of
the entity; or 
(v) a lot owned by a trust or other entity created for estate planning purposes if the trust
or other estate planning entity was created for:
(A) the estate of a current resident of the lot; or
(B) the parent, child, or sibling of the current resident of the lot;
(b) a provision that allows a lot owner who has a rental in the association before the
time the rental restriction described in Subsection (1)(a) is recorded with the county recorder of
the county in which the association is located to continue renting until:
(i) the lot owner occupies the lot; [
or
]
(ii) an officer, owner, member, trustee, beneficiary, director, or person holding a
similar position of ownership or control of an entity or trust that holds an ownership interest in
the lot, occupies the lot; [
and
] 
or
(iii) the lot is transferred; and
(c) a requirement that the association create, by rule or resolution, procedures to:
(i) determine and track the number of rentals and lots in the association subject to the
provisions described in Subsections (2)(a) and (b); and
(ii) ensure consistent administration and enforcement of the rental restrictions.
(3) For purposes of Subsection (2)(b)
(iii)
, a transfer occurs when one or more of the
following occur:
(a) the conveyance, sale, or other transfer of a lot by deed;
(b) the granting of a life estate in the lot; or
(c) if the lot is owned by a limited liability company, corporation, partnership, or other
business entity, the sale or transfer of more than 75% of the business entity's share, stock,
membership interests, or partnership interests in a 12-month period.
(4) This section does not limit or affect residency age requirements for an association
that complies with the requirements of the Housing for Older Persons Act, 42 U.S.C. Sec.
3607.
(5) A declaration of covenants, conditions, and restrictions or amendments to the
declaration of covenants, conditions, and restrictions recorded before the transfer of the first lot
from the initial declarant may prohibit or restrict rentals without providing for the exceptions,
provisions, and procedures required under Subsection (2).
(6) (a) Subsections (1) through (5) do not apply to:
(i) an association that contains a time period unit as defined in Section 
57-8-3
;
(ii) any other form of timeshare interest as defined in Section 
57-19-2
; or
(iii) subject to Subsection (6)(b), an association that is formed before May 12, 2009,
unless, on or after May 12, 2015, the association:
(A) adopts a rental restriction or prohibition; or
(B) amends an existing rental restriction or prohibition.
(b) An association that adopts a rental restriction or amends an existing rental
restriction or prohibition before May 9, 2017, is not required to include the exemption
described in Subsection (2)(a)(iv).
(7) Notwithstanding this section, an association may restrict or prohibit rentals without
an exception described in Subsection (2) if:
(a) the restriction or prohibition receives unanimous approval by all lot owners; and
(b) when the restriction or prohibition requires an amendment to the association's
recorded declaration of covenants, conditions, and restrictions, the association fulfills all other
requirements for amending the recorded declaration of covenants, conditions, and restrictions
described in the association's governing documents.
(8) Except as provided in Subsection (9), an association may not require a lot owner
who owns a rental lot to:
(a) obtain the association's approval of a prospective renter;
(b) give the association:
(i) a copy of a rental application;
(ii) a copy of a renter's or prospective renter's credit information or credit report;
(iii) a copy of a renter's or prospective renter's background check; or
(iv) documentation to verify the renter's age; or
(c) pay an additional assessment, fine, or fee because the lot is a rental lot.
(9) (a) A lot owner who owns a rental lot shall give an association the documents
described in Subsection (8)(b) if the lot owner is required to provide the documents by court
order or as part of discovery under the Utah Rules of Civil Procedure.
(b) If an association's declaration of covenants, conditions, and restrictions lawfully
prohibits or restricts occupancy of the lots by a certain class of individuals, the association may
require a lot owner who owns a rental lot to give the association the information described in
Subsection (8)(b), if:
(i) the information helps the association determine whether the renter's occupancy of
the lot complies with the association's declaration of covenants, conditions, and restrictions;
and
(ii) the association uses the information to determine whether the renter's occupancy of
the lot complies with the association's declaration of covenants, conditions, and restrictions.
(10) The provisions of Subsections (8) and (9) apply to an association regardless of
when the association is created.
Section 8. Section 
57-8a-211
 is amended to read:
57-8a-211.
Reserve analysis -- Reserve fund.
(1) As used in this section:
(a) "Reserve analysis" means an analysis to determine:
(i) the need for a reserve fund to accumulate reserve funds; and
(ii) the appropriate amount of any reserve fund.
(b) "Reserve fund line item" means the line item in an association's annual budget that
identifies the amount to be placed into a reserve fund.
(c) "Reserve funds" means money to cover the cost of repairing, replacing, or restoring
common areas and facilities that have a useful life of three years or more and a remaining
useful life of less than 30 years, if the cost cannot reasonably be funded from the general
budget or other funds of the association.
(2) Except as otherwise provided in the governing documents, a board shall:
(a) cause a reserve analysis to be conducted no less frequently than every six years; and
(b) review and, if necessary, update a previously conducted reserve analysis no less
frequently than every three years.
(3) The board may conduct a reserve analysis itself or may engage a reliable person or
organization, as determined by the board, to conduct the reserve analysis.
(4) A reserve fund analysis shall include:
(a) a list of the components identified in the reserve analysis that will reasonably
require reserve funds;
(b) a statement of the probable remaining useful life, as of the date of the reserve
analysis, of each component identified in the reserve analysis;
(c) an estimate of the cost to repair, replace, or restore each component identified in the
reserve analysis;
(d) an estimate of the total annual contribution to a reserve fund necessary to meet the
cost to repair, replace, or restore each component identified in the reserve analysis during the
component's useful life and at the end of the component's useful life; and
(e) a reserve funding plan that recommends how the association may fund the annual
contribution described in Subsection (4)(d).
(5) An association shall:
(a) annually provide lot owners a summary of the most recent reserve analysis or
update; and
(b) provide a copy of the complete reserve analysis or update to a lot owner who
requests a copy.
(6) In formulating [
its
] 
the association's
 budget each year, an association shall include a
reserve fund line item in:
(a) an amount the board determines, based on the reserve analysis, to be prudent; or
(b) an amount required by the governing documents, if the governing documents
require an amount higher than the amount determined under Subsection (6)(a).
(7) (a) Within 45 days after the day on which an association adopts [
its
] 
the
association's
 annual budget, the lot owners may veto the reserve fund line item by a 51% vote
of the allocated voting interests in the association at a special meeting called by the lot owners
for the purpose of voting whether to veto a reserve fund line item.
(b) If the lot owners veto a reserve fund line item under Subsection (7)(a) and a reserve
fund line item exists in a previously approved annual budget of the association that was not
vetoed, the association shall fund the reserve account in accordance with that prior reserve fund
line item.
(8) (a) Subject to Subsection (8)(b), if an association does not comply with the
requirements described in Subsection (5), (6), or (7) and fails to remedy the noncompliance
within the time specified in Subsection (8)(c), a lot owner may file an action in state court for:
(i) injunctive relief requiring the association to comply with the requirements of
Subsection (5), (6), or (7);
(ii) $500 or the lot owner's actual damages, whichever is greater;
(iii) any other remedy provided by law; and
(iv) reasonable costs and attorney fees.
(b) No fewer than 90 days before the day on which a lot owner files a complaint under
Subsection (8)(a), the lot owner shall deliver written notice described in Subsection (8)(c) to
the association.
(c) A notice under Subsection (8)(b) shall state:
(i) the requirement in Subsection (5), (6), or (7) with which the association has failed to
comply;
(ii) a demand that the association come into compliance with the requirements; and
(iii) a date, no fewer than 90 days after the day on which the lot owner delivers the
notice, by which the association shall remedy its noncompliance.
(d) In a case filed under Subsection (8)(a), a court may order an association to produce
the summary of the reserve analysis or the complete reserve analysis on an expedited basis and
at the association's expense.
(9) (a) [
A
] 
Unless a majority of association members vote to approve the use of reserve
fund money for that purpose, a
 board may not use money in a reserve fund:
(i) for daily maintenance expenses[
, unless a majority of association members vote to
approve the use of reserve fund money for that purpose
]; or
(ii) for any purpose other than the purpose for which the reserve fund was established.
(b) A board shall maintain a reserve fund separate from other association funds.
(c) This Subsection (9) may not be construed to limit a board from prudently investing
money in a reserve fund, subject to any investment constraints imposed by the governing
documents.
(10) Subsections (2) through (9) do not apply to an association during the period of
administrative control.
(11) For a project whose initial declaration of covenants, conditions, and restrictions is
recorded on or after May 12, 2015, during the period of administrative control, for any property
that the declarant sells to a third party, the declarant shall give the third party:
(a) a copy of the association's governing documents; and
(b) a copy of the association's most recent financial statement that includes any reserve
funds held by the association or by a subsidiary of the association.
(12) Except as otherwise provided in this section, this section applies to each
association, regardless of when the association was created.
Section 9. Section 
57-8a-212.5
 is enacted to read:
 57-8a-212.5.
Compliance with governing documents.
Subject to reasonable compliance therewith by the board, each lot owner shall
reasonably comply with the governing documents, as the governing documents may be lawfully
amended from time to time, and failure to comply shall be ground for an action to recover sums
due for damages or injunctive relief or both, maintainable by the board on behalf of the lot
owners, or in a proper case, by an aggrieved lot owner.
Section 10. Section 
57-8a-227
 is amended to read:
57-8a-227.
Records -- Availability for examination.
(1) (a) Subject to Subsection (1)(b), an association shall keep and make documents
available to lot owners in accordance with Sections 
16-6a-1601
 through 1603, 
16-6a-1605
,
16-6a-1606
, and 
16-6a-1610
[
,
]
:
(i)
 regardless of whether the association is incorporated under Title 16, Chapter 6a,
Utah Revised Nonprofit Corporation Act[
.
]
; and
(ii) including keeping and making available to lot owners a copy of the association's:
(A) declaration and bylaws;
(B) most recent approved minutes; and
(C) most recent budget and financial statement.
(b) An association may redact the following information from any document the
association produces for inspection or copying:
(i) a Social Security number;
(ii) a bank account number; or
(iii) any communication subject to attorney-client privilege.
(2) (a) In addition to the requirements described in Subsection (1), an association shall
:
(i)
 make documents available to lot owners in accordance with the association's
governing documents[
.
]
; and
(ii) (A) if the association has an active website, make the documents described in
Subsection (1)(a)(ii) available to lot owners, free of charge, through the website; or
(B) if the association does not have an active website, make physical copies of the
documents described in Subsection (1)(a)(ii) available to lot owners during regular business
hours at the association's address registered with the Department of Commerce under Section
57-8a-105
.
(b) Subsection (2)(a)(ii) does not apply to an association as defined in Section 
57-19-2
.
[
(b)
] 
(c)
 If a provision of an association's governing documents conflicts with a
provision of this section, the provision of this section governs.
(3) In a 
written
 request to inspect or copy documents[
,
]
:
(a) a lot owner shall include:
(i) the association's name;
(ii) the lot owner's name;
(iii) the lot owner's property address;
(iv) the lot owner's email address;
(v) a description of the documents requested; and
(vi) any election or request described in Subsection (3)(b); and
(b)
 a lot owner may:
[
(a)
] 
(i)
 elect whether to inspect or copy the documents;
[
(b)
] 
(ii)
 if the lot owner elects to copy the documents, request hard copies or electronic
scans of the documents; or
[
(c)
] 
(iii)
 subject to Subsection (4), request that:
[
(i)
] 
(A)
 the association make the copies or electronic scans of the requested
documents;
[
(ii)
] 
(B)
 a recognized third party duplicating service make the copies or electronic
scans of the requested documents; [
or
]
[
(iii)
] 
(C)
 the lot owner be allowed to bring any necessary imaging equipment to the
place of inspection and make copies or electronic scans of the documents while inspecting the
documents[
.
]
; or
(D) the association email the requested documents to an email address provided in the
request.
(4) (a) An association shall comply with a request described in Subsection (3).
(b) If an association produces the copies or electronic scans:
(i) the copies or electronic scans shall be legible and accurate; and
(ii) the lot owner shall pay the association the reasonable cost of the copies or
electronic scans 
and for time spent meeting with the lot owner
, which may not exceed:
(A) the actual cost that the association paid to a recognized third party duplicating
service to make the copies or electronic scans; or
(B) [
if an employee, manager, or other agent of the association makes the copies or
electronic scans,
] 10 cents per page and $15 per hour for the employee's, manager's, or other
agent's time [
making the copies or electronic scans
].
(c) If a lot owner requests a recognized third party duplicating service make the copies
or electronic scans:
(i) the association shall arrange for the delivery and pick up of the original documents;
and
(ii) the lot owner shall pay the duplicating service directly.
(d) If a lot owner requests to bring imaging equipment to the inspection, the association
shall provide the necessary space, light, and power for the imaging equipment.
(5) [
If
] 
Subject to Subsection (9), if
, in response to a lot owner's request to inspect or
copy documents, an association fails to comply with a provision of this section, the association
shall pay:
(a) the reasonable costs of inspecting and copying the requested documents; [
and
]
(b) for items described in Subsection (1)(a)(ii), $25 to the lot owner who made the
request for each day the request continues unfulfilled, beginning the sixth day after the day on
which the lot owner made the request; and
[
(b)
] 
(c)
 reasonable attorney fees and costs incurred by the lot owner in obtaining the
inspection and copies of the requested documents.
(6) (a) In addition to any remedy in the association's governing documents or otherwise
provided by law, a lot owner may file an action in court under this section if:
(i) 
subject to Subsection (9),
 an association fails to make documents available to the lot
owner in accordance with this section, the association's governing documents, or as otherwise
provided by law; and
(ii) the association fails to timely comply with a notice described in Subsection (6)(d).
(b) In an action described in Subsection (6)(a):
(i) the lot owner may request:
(A) injunctive relief requiring the association to comply with the provisions of this
section;
(B) $500 or actual damage, whichever is greater; or
(C) any other relief provided by law; and
(ii) the court shall award costs and reasonable attorney fees to the prevailing party,
including any reasonable attorney fees incurred before the action was filed that relate to the
request that is the subject of the action.
(c) (i) In an action described in Subsection (6)(a), upon motion by the lot owner, notice
to the association, and a hearing in which the court finds a likelihood that the association failed
to comply with a provision of this section, the court shall order the association to immediately
comply with the provision.
(ii) The court shall hold a hearing described in Subsection (6)(c)(i) within 30 days after
the day on which the lot owner files the motion.
(d) At least 10 days before the day on which a lot owner files an action described in
Subsection (6)(a), the lot owner shall deliver a written notice to the association that states:
(i) the lot owner's name, address, telephone number, and email address;
(ii) each requirement of this section with which the association has failed to comply;
(iii) a demand that the association comply with each requirement with which the
association has failed to comply; and
(iv) a date by which the association shall remedy the association's noncompliance that
is at least 10 days after the day on which the lot owner delivers the notice to the association.
(7) (a) The provisions of Section 
16-6a-1604
 do not apply to an association.
(b) The provisions of this section apply regardless of any conflicting provision in Title
16, Chapter 6a, Utah Revised Nonprofit Corporation Act.
(8) A lot owner's agent may, on the lot owner's behalf, exercise or assert any right that
the lot owner has under this section.
(9) An association is not liable for identifying or providing a document in error, if the
association identified or provided the erroneous document in good faith.
Section 11. Section 
57-8a-230
 is enacted to read:
 57-8a-230.
Administration of funds.
An association:
(1) shall keep all of the association's funds in an account in the name of the association;
and
(2) may not commingle the association's funds with the funds of any other person.