Washington State Law Changes
Senate Bill 6215, which was passed earlier this year, has gone into effect in Washington State. The legislation, effective as of June 12, 2008, now requires all condominium associations formed after July1, 1990 to prepare a reserve study in accordance with RCW 64.34.244(1) and the governing documents of the association.
The initial reserve study must be based on a visual onsite evaluation of the association’s common components performed by a reserve study professional. Known as a Level 1 reserve study; this type of study is of the most value when the onsite assessment is performed by an independent architect or engineer, although in many cases the assessment will be conducted by the reserve study preparer or members of their staff.
While there are reserve study providers who employ in-house personnel with architectural or engineering credentials; HOA Services Group strongly recommends all associations consider the option of having an independent consultant prepare the condition assessment. It provides a level of analysis and objectivity which cannot be expected if the architectural consultant and the reserve study professional are one and the same.
The new law also requires the association to update their study every year; although it does not specifically require the update be conducted with the assistance of a professional reserve study provider. Every three years an existing reserve study must be updated with the update being based on a new onsite evaluation performed by a reserve study professional. This type of updated reserve study is known as a Level 2 reserve study.
Highlights of the New Law-
Senate Bill 6215, which took affect on June 12, 2008 after passage on March 8, 2008, will effect Washington condominium owners and prospective buyers in a number of important ways. Among the highlights of the new law are the following;
This association does not have a current reserve study. The lack of a current reserve study poses certain risks to you, the purchaser. Insufficient reserves may, under some circumstances, require you to pay on demand as a special assessment your share of common expenses for the cost of major maintenance, repair or replacement of a common element.
The law goes on to describe specific content and information which is required to be included in all reserve studies prepared for condominiums in the state of Washington, among other things; and includes a lengthy section of definitions for terms used in the context of the Condominium Act and reserve studies in general.
To summarize this rather dramatic change in Washington law; it is fair to say the state of Washington has moved from the back of the pack to the head of the line as one of only a handful of states which now require condominium associations to maintain a professionally prepared reserve study and to disclose the reserve fund status to all prospective condominium buyers.
Over time this important legislation will have a positive impact on the quality of life of all condominium owners and the element of risk faced by prospective buyers who in the majority of states would not be entitled to the level of disclosure now required in Washington.
HOA Services Group, LLC supports this new legislation and applauds the Washington State legislature with this important consumer protection measure.
For more information about the importance of reserve studies for all homeowner’s associations and prospective buyers [click here]
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