Condo Media - September 2016 - 46

The Region

NEW HAMPSHIRE

Back
to the
Drawing
Board...
Again

Condominium Act
Changes and Proper
Compliance for
Association Boards
[by Gary M. Daddario, Esq., CCAL]

In my last column here, I discussed
some of the many changes resulting from the passage of HB 353
and effective Aug. 1, 2016. This
month, I continue the discussion with
more of the changes that HB 353 brings
to RSA 356-B.
UNIT OWNER BOARD
In the modified Section 40, the Act will
now set limits on the declarant's period of
control regardless of the period set forth
in the declaration. Further, the unit owner
board (as opposed to the declarant's appointed board) will be gradually placed
into office in stages dependent upon
the sales of units. This is good news for
associations as clear transition triggering
events are presented and a unit owner
board will gradually take office with early
members having some knowledge of the
operation of the condominium. This continuity will avoid the "culture shock" that
sometimes occurs when operations are
turned over to an otherwise uninformed
new unit owner board.
In a new Section 40-b, removal
procedures for officers and directors are
discussed. Noteworthy provisions include:
a) a removal vote which requires only a
simple majority of those present in person
or by proxy at a meeting in which quorum
is achieved; b) no officer or director ap-

46

CONDOMEDIA

pointed by the declarant may be removed
during the declarant's period of control;
c) a removal vote must be included in a
meeting notice in order for such vote to
occur at a meeting; and d) an officer or
director must be provided a reasonable opportunity to speak prior to a removal vote
of which he/she is the subject.
BUDGETS & SPECIAL
ASSESSMENTS
A new Section 40-c speaks to the
procedure by which associations adopt
budgets. Although the authority continues to initially rest with the board,
it is necessary that the board provide
a summary of the annual budget to
the community. Further, the board
must schedule a community meeting
not less than 10 days or more than 60
days after providing said summary. At
the community meeting, regardless of
whether or not quorum is achieved, the

board's budget shall be ratified unless
two-thirds of all owners (or any larger
percentage specified in the declaration) vote to reject it. If a new budget is
rejected, the last approved budget shall
remain in effect until such time as a
subsequent budget is ratified. While the
terms of this provision will ultimately
result in the vast majority of boards'
budgets being ratified, the mandatory
summary, meeting, and voting will
certainly add to the time and effort
required for the annual association
budget to be put into place.
Additional language in the amended
Act addresses special assessments.
Although the board may still propose
special assessments at any time, in order
for such assessments to take effect, the
board must undertake the procedure discussed above for ratification of a budget.
As with the budget itself, the special
assessment is ratified unless two-thirds
Condo Media - September 2016

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