2025 -- H 5824

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LC001676

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2025

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A N   A C T

RELATING TO PROPERTY -- CONDOMINIUM LAW

     Introduced By: Representative Brandon T. Voas

     Date Introduced: February 28, 2025

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 34-36.1-1.02 of the General Laws in Chapter 34-36.1 entitled

"Condominium Law" is hereby amended to read as follows:

     34-36.1-1.02. Applicability.

     (a)(1) This chapter applies to all condominiums created within this state after July 1, 1982,

except that any condominium created within this state prior to July 1, 1982, may voluntarily accept

the provisions of this chapter in lieu of the provisions under which it was originally organized.

Acceptance shall be evidenced by an agreement in writing executed by and in behalf of the

condominium association and by all of the owners of all of the individual condominium units within

the condominium, in which agreement it is clearly stated that they all accept the provisions of this

chapter in lieu of those in the statute under which the condominium was organized and wish to be

governed in the future by the provisions of this chapter. The agreement shall be recorded in the

land evidence records of each and every town or city where all or any part of the land in the

condominium concerned may be located and shall become effective when first so recorded. The

acceptance shall only apply to the governance of the condominium concerned as to all matters

which are prospective or executory in nature; and nothing herein shall be deemed to abrogate,

amend, limit, effect, or impair the continued effectiveness, legality, or validity of all actions

lawfully taken by or in behalf of the condominium prior to the effective date of the acceptance,

including, but without limitation, the condominium declaration and all amendments thereto, the by-

laws of the condominium and/or of its association, all deeds, mortgages, leases, and any further

documents affecting the titles or rights of unit owners, or of the condominium or the prior lawful

acts or deeds of any kind, of the condominium association, its officers, directors, or members.

     (2) Sections 34-36.1-1.05 (separate titles and taxation), 34-36.1-1.06 (applicability of local

ordinances, regulations, and building codes), 34-36.1-1.07 (eminent domain), 34-36.1-2.03

(construction and validity of declaration and bylaws), 34-36.1-2.04 (description of units), 34-36.1-

3.02(a)(1) — (6) and (11) — (17) (powers of unit owners’ association), 34-36.1-3.06(c) — (d)

(bylaws), 34-36.1-3.11 (tort and contract liability), 34-36.1-3.16 (lien for assessments), 34-36.1-

3.18 (association records), 34-36.1-3.22 (reserve study and reserve account), 34-36.1-4.09 (resale

of units), and 34-36.1-4.17 (effect of violation on rights of action; attorney’s fees), § 34-36.1-3.20

(enforcement of declaration, bylaws and rules), and 34-36.1-1.03 (definitions), to the extent

necessary in construing any of those sections, apply to all condominiums created in this state before

July 1, 1982; but those sections apply only with respect to events and circumstances occurring after

July 1, 1982, and do not invalidate existing provisions of the declaration, bylaws, plats, or plans of

those condominiums.

     (3) A condominium created as an additional phase by amendment of a condominium

created prior to July 1, 1982, if the original declaration contemplated the amendment, shall be

deemed to be a condominium created prior to July 1, 1982; provided, however, the provisions of

subdivision (a)(2) shall apply as defined therein.

     (4) Section 34-36.1-3.21 (foreclosure of condominium lien) applies, with respect to all

condominiums created in this state prior to June 19, 1991, only with respect to events and

circumstances occurring after June 18, 1991, does not invalidate existing provisions of the

declarations, bylaws, plats, or plans of those condominiums, and applies in all respects to all

condominiums created in this state after June 18, 1991.

     (b) The provisions of the Condominium Ownership Act, chapter 36 of this title, do not

apply to condominiums created after July 1, 1982, and do not invalidate any amendment to the

declaration, bylaws, plats, and plans of any condominium created before July 1, 1982, if the

amendment would be permitted by this chapter. The amendment must be adopted in conformity

with the procedures and requirements specified by those instruments and by chapter 36 of this title.

If the amendment grants to any person any rights, powers, or privileges permitted by this chapter,

all correlative obligations, liabilities, and restrictions in this chapter also apply to that person.

     (c) This chapter does not apply to condominiums or units located outside this state, but the

public offering statement provisions (§§ 34-36.1-4.02 — 34-36.1-4.07) apply to all contracts for

the disposition thereof signed in this state by any party unless exempt under § 34-36.1-4.01(b).

     SECTION 2. Chapter 34-36.1 of the General Laws entitled "Condominium Law" is hereby

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amended by adding thereto the following section:

     34-36.1-3.22. Reserve study and reserve account.

     (a) This section applies to all condominiums that have structural common element

components that would cost at least twenty thousand dollars ($20,000) to replace.

     (b) A condominium association shall have a reserve study which shall contain an

itemization of common elements which require maintenance, repair or replacement by the

association in the future because of anticipated deterioration of those common elements.

     (c) The reserve study shall identify specific common elements, the anticipated period of

time before maintenance, repair or replacement is necessary, and the estimated expenses for such

work at estimated times in the future, and shall be certified and dated by an engineer or architect

licensed by the State of Rhode Island.

     (d) The reserve study shall reference estimated association fiscal year funds from the

annual assessment to be deposited into the association reserve financial account which shall be

established, and maintained by the executive board, and not deposited into the separate association

operating financial account which shall be established and maintained by the executive board.

     (e) The executive board shall act to have a reserve study for its association which shall be

used by an executive board for no more than five (5) years from the date of the reserve study.

     (f) The executive board shall adopt a proposed budget for the association as required by §

34-36.1-3.03(c), which shall include in the annual assessment for the association no less than one

hundred percent (100%) funding of expenses referenced in the reserve study no later than July 1,

2027.

     (g) Funds in the association reserve account shall not be used for any purposes other than

those referenced in the reserve study.

     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PROPERTY -- CONDOMINIUM LAW

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     This act would require condo associations to obtain and comply with reserve studies

certified by an architect or engineer, which identifies specific common element components that

will need to be repaired or replaced in the future, as well as estimate the future necessary expenses

for repairs and replacement which are broken down to a monthly dollar amount per unit in an

association budget. The condo association would be required to maintain a reserve fund separate

from the operating fund. The reserve fund would be required to be one hundred percent (100%)

funded for all expenses referenced in the reserve study. The executive board would be prohibited

from using any of the reserve fund except for items specified in the reserve study.

     This act would take effect upon passage.

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