Important Alert: New Jersey Department of Community Affairs Proposes New Regulations on Community Association Governance
June 15th, 2019 | Community Association Law Blog
By Eric F. Frizzell, Esq.
On June 3, 2019, the New Jersey Department of Community Affairs (“DCA”) published proposed amendments to regulations under the Planned Real Estate Development Full Disclosure Act. The regulations are intended to implement the 2017 “Radburn Amendments” and “to enhance resident voting participation rights” in community associations. Many of the proposed regulations merely implement the Radburn Amendments, while others impose new obligations on Boards and their property managers that go well beyond the express scope of the Radburn Amendments.
The full text of the regulations can be found on the DCA’s website at:
You may notify the New Jersey chapter of the Community Associations Institute (phone: 609-588-0030, email: email@example.com) if you oppose any of the regulations or have questions or concerns about them. You may also submit your comments directly to the DCA by August 2, 2019 by sending them to: Geraldine Callahan, Department of Community Affairs, PO Box 800, Trenton, NJ 08625, fax no. (609)984-6696, email: firstname.lastname@example.org.
Please feel free to contact our law firm if you have any questions about the proposed regulations. Some of the proposed regulations include the following:
• Members of an association’s board appointed by the developer shall be liable as fiduciaries to the unit owners for their acts or omissions.
• A developer who retains at least one unit as a rental unit shall not be entitled to an automatic seat on the board.
• A developer who is no longer entitled to an automatic seat on the board is not prevented from being a candidate for election to a position on the board.
• No association procedure shall impose any requirements for voting on low- or moderate-income housing owners that would interfere with their right to vote.
• Any depository for physical ballots shall be secured.
• All ballot tallying shall occur publicly and the ballots shall be open to inspection by any member of the association for a period of 90 days from the date of the election.
• All ballots shall be cast in an anonymous manner.
• A minimum of 14 days prior to the election (associations with fewer than 50 units), or 30 days prior to the election (associations with 50 or more units), the association shall notify residents who are not in good standing. The notice shall state the reason why the resident is not in good standing, and shall further state that the resident has the right to contest the board’s determination by requesting Alternative Dispute Resolution. Residents shall be allowed to rectify their standing up to five business days prior to the election date.
• Ballots may not indicate incumbent board members.
• Ballots must include spaces for write-in candidates for as many seats as are up for election.
• When owners of affordable housing units represent a minority of units in the development, the bylaws shall reserve a seat or seats on the board for election by owners of affordable units.
• A person or owning entity shall not hold more than one seat on the board.
• The board shall not remove an elected board member for violating any confidentiality agreement without affording that elected member ADR in which the ADR provider concludes from substantial credible evidence that there was a breach that adversely affected the interests of the association members as opposed to that of the board.
• The regulations create a process for unit owners seeking the removal of a board member.
• An association’s board shall provide a brief explanation of the basis for and cost entailed in any matter that is the subject of any binding vote, and shall include the explanation in the minutes for the meeting.
• Any changes by a board to its posted open meeting schedule shall be made at least seven days prior to the scheduled date.
• A board must provide notice of its meetings at least seven days prior to the meeting date by posting it on the association’s website and by personally providing notice to each member (which the member can waive in writing) by mail, hand-delivery or electronic means. The notice must include agenda items, which shall include items for discussion, items for action, and reoccurring items such as passage of a budget.
• A vote taken at a closed meeting shall not be binding. If the matter requires a binding vote, it shall be taken at a subsequent open meeting in a manner that does not disclose any confidences.
• When a meeting of the board is required to deal with matters of such urgency and importance that delay for the purpose of providing seven days advance notice would be likely to result in substantial harm to the interests of the association and provided that the meeting is limited to discussion of, and acting with respect to, such matters of urgency and importance, notice of the emergency meeting shall be deemed to be adequate if it is provided as soon as possible following the calling of the meeting.
• If a board cancels a scheduled meeting, it must post notice of the cancellation prior to the scheduled start of the meeting and state when the meeting will be rescheduled and the reason for the cancellation.
Please feel free to contact our law firm if you have any questions about the proposed regulations.