Amendment No. 544

Senate Amendment to Senate Bill No. 192 (BDR 10-70)

Proposed by: Committee on Judiciary

Amendment Box:

Resolves Conflicts with: N/A

Amends: Summary: Title: Preamble: Joint Sponsorship:

ASSEMBLY ACTION Initial and Date | SENATE ACTION Initial and Date

Adopted Lost | Adopted Lost

Concurred In Not | Concurred In Not

Receded Not | Receded Not

Amend the bill as a whole by deleting sections 1 through 10 and adding new sections designated sections 1 through 10, following the enacting clause, to read as follows:

"Section 1. Chapter 116 of NRS is hereby amended by adding thereto the provisions set forth as sections 2, 3 and 4 of this act.

Sec. 2. Notwithstanding any provision of the governing documents to the contrary, in a planned community, an association may not:

1. With respect to property located within the planned community that is not a unit:

(a) Prohibit or otherwise object to any residential use of the property unless such use violates any applicable zoning regulations or restrictions.

(b) Adopt any restrictions on the residential use of the property that are inconsistent with any applicable zoning regulations or restrictions.

(c) Prohibit pedestrian or vehicular ingress or egress to the property. This paragraph does not prohibit an association from charging the owner of the property a reasonable and nondiscriminatory fee for the purpose of operating and maintaining a gate or other similar device designed to control access to the community that would otherwise impede ingress or egress to the property.

2. Construct a maintenance facility at a location that is not consistent with the master plan for the community unless the association obtains the written consent of all units’ owners whose property is located within 500 feet of the proposed facility. Notwithstanding any provision of law, a governmental entity shall not issue any permit for the construction of a maintenance facility described in this subsection unless the governmental entity first receives written evidence of compliance with this subsection.

Sec. 3. Notwithstanding any provision of the governing documents to the contrary:

1. An officer of the association or a member of the executive board shall serve for a term not to exceed 2 years.

2. An officer of the association or a member of the executive board may be elected to succeed himself.

Sec. 4. Notwithstanding any provision of the governing documents to the contrary:

1. Each meeting of an association must be conducted in accordance with the provisions of chapter 241 of NRS.

2. The proceedings at any meeting of an association must be governed by Roberts Rules of Order.

Sec. 5. NRS 116.11038 is hereby amended to read as follows:

116.11038 "Residential use" means use as a dwelling or for personal, family or household purposes by ordinary customers, whether rented to particular persons or not. Such uses include marina boat slips, piers, stable or agricultural stalls or pens, campground spaces or plots, parking spaces or garage spaces, storage spaces or lockers and garden plots for individual use, but do not include spaces or units primarily used to derive commercial income from, or provide service to, the public.

Sec. 6. NRS 116.2116 is hereby amended to read as follows:

116.2116 1. Subject to the provisions of the declaration, a declarant has an easement through the common elements as may be reasonably necessary to discharge the declarant’s obligations or exercise special declarant’s rights, whether arising under this chapter or reserved in the declaration.

2. In a planned community, subject to the provisions of paragraph (f) of subsection 1 of NRS 116.3102 and NRS 116.3112, the units’ owners have an easement:

(a) In the common elements for purposes of access to their units; and

(b) To use the common elements and all real estate that must become common elements (paragraph (f) of subsection 1 of NRS 116.2105) for all other purposes.

3. Within the Lake Tahoe Watershed, unless the terms of an easement in favor of an association specifically prohibit the construction of a pier, dock or other similar recreational facility, if the owner of the servient estate has obtained a permit pursuant to NRS 445A.170 for the construction of a pier, dock or other similar recreational facility, the owner may construct a pier, dock or other similar recreational facility without obtaining any other approval. As used in this subsection, "Lake Tahoe Watershed" means all of that area draining in the Lake Tahoe Basin and Lake Tahoe in Nevada.

Sec. 7. NRS 116.21185 is hereby amended to read as follows:

116.21185 The respective interests of units’ owners referred to in subsections 5, 6 and 7 of NRS 116.2118 and in NRS 116.21183 are as follows:

1. Except as otherwise provided in subsection 2, the respective interests of units’ owners are the fair market values of their units, allocated interests, and any limited common elements immediately before the termination, as determined by one or more independent appraisers selected by the association. The decision of the independent appraisers must be distributed to the units’ owners and becomes final [unless disapproved] if approved within 30 days after distribution by units’ owners to whom [25] 75 percent of the votes in the association are allocated. The proportion of interest of any unit’s owner to that of all units’ owners is determined by dividing the fair market value of that unit and its allocated interests by the total fair market values of all the units and their allocated interests.

2. If any unit or any limited common element is destroyed to the extent that an appraisal of the fair market value [thereto] of the unit or limited common element before destruction cannot be made, the interests of all units’ owners are:

(a) In a condominium, their respective interests in the common elements immediately before the termination;

(b) In a cooperative, their respective ownerships immediately before the termination; and

(c) In a planned community, their respective liabilities for common expenses immediately before the termination.

Sec. 8. NRS 116.3103 is hereby amended to read as follows:

116.3103 1. Except as otherwise provided in the declaration, the bylaws, this section or other provisions of this chapter, the executive board may act in all instances on behalf of the association. In the performance of their duties, the officers and members of the executive board are fiduciaries and are subject to the insulation from liability provided for directors of corporations by the laws of this state. The members of the executive board are required to exercise the ordinary and reasonable care of directors of a corporation, subject to the business-judgment rule.

2. The executive board may not act on behalf of the association to amend the declaration (NRS 116.2117), to terminate the common-interest community (NRS 116.2118), [or] to elect members of the executive board or determine their qualifications, powers and duties or terms of office (subsection 1 of NRS 116.31034) [,] or to make assessments for common expenses, but the executive board may fill vacancies in its membership for the unexpired portion of any term.

3. Within 30 days after adoption of any proposed budget for the common-interest community, the executive board shall provide a summary of the budget to all the units’ owners, and shall set a date for a meeting of the units’ owners to consider ratification of the budget not less than 14 nor more than 30 days after mailing of the summary. [Unless at that meeting a majority of all units’ owners or any larger vote specified in the declaration reject the budget, the budget is ratified, whether or not] The units’ owners must ratify the budget by at least a two-thirds vote of all persons present and entitled to vote at any meeting of the units’ owners at which a quorum is present. If the proposed budget is [rejected,] not ratified, the periodic budget last ratified by the units’ owners must be continued until such time as the units’ owners ratify a subsequent budget proposed by the executive board.

Sec. 9. NRS 116.31034 is hereby amended to read as follows:

116.31034 1. Except as otherwise provided in subsection 5 of NRS 116.212, not later than the termination of any period of declarant’s control, the units’ owners shall elect an executive board of at least three members, at least a majority of whom must be units’ owners. The executive board shall elect the officers. The members and officers of the executive board shall take office upon election. Notwithstanding any provision of the governing documents to the contrary, for the election of members and officers of the executive board:

(a) Votes may not be cast by proxy; and

(b) Units’ owners must be allowed to cast votes by absent ballot.

2. An officer, employee, agent or director of a corporate owner of a unit, a trustee or designated beneficiary of a trust that owns a unit, a partner of a partnership that owns a unit, and a fiduciary of an estate that owns a unit may be an officer or member of the executive board. In all events where the person serving or offering to serve as an officer or member of the executive board is not the record owner, he shall file proof of authority in the records of the association.

3. Each member of the executive board shall, at the time of his appointment or election, certify in writing that he has [read] :

(a) Resided within the common-interest community or this state for a period of not less than 270 days during the previous year.

(b) Read and understands the governing documents of the association and the provisions of this chapter.

4. On the anniversary date of the certification made pursuant to paragraph (a) of subsection 3, a member of the executive board shall certify in writing that he has resided within the common-interest community or this state for a period of not less than 270 days during the previous year.

Sec. 10. NRS 116.311 is hereby amended to read as follows:

116.311 1. If only one of several owners of a unit is present at a meeting of the association, that owner is entitled to cast all the votes allocated to that unit. If more than one of the owners are present, the votes allocated to that unit may be cast only in accordance with the agreement of a majority in interest of the owners, unless the declaration expressly provides otherwise. There is majority agreement if any one of the owners cast the votes allocated to that unit without protest made promptly to the person presiding over the meeting by any of the other owners of the unit.

2. [Votes] Except as otherwise provided in paragraph (a) of subsection 1 of NRS 116.31034, votes allocated to a unit may be cast pursuant to a proxy executed by a unit’s owner. If a unit is owned by more than one person, each owner of the unit may vote or register protest to the casting of votes by the other owners of the unit through an executed proxy. A unit’s owner may revoke a proxy given pursuant to this section only by actual notice of revocation to the person presiding over a meeting of the association. A proxy is void if it is not dated or purports to be revocable without notice. A proxy terminates one year after its date, unless it specifies a shorter term.

3. If the declaration requires that votes on specified matters affecting the common-interest community be cast by lessees rather than units’ owners of leased units:

(a) The provisions of subsections 1 and 2 apply to lessees as if they were units’ owners;

(b) Units’ owners who have leased their units to other persons may not cast votes on those specified matters; and

(c) Lessees are entitled to notice of meetings, access to records, and other rights respecting those matters as if they were units’ owners.

Units’ owners must also be given notice, in the manner provided in NRS 116.3108, of all meetings at which lessees are entitled to vote.

4. No votes allocated to a unit owned by the association may be cast.".

Amend the bill as a whole by deleting the preamble.

Amend the title of the bill to read as follows:

"AN ACT relating to common-interest communities; enacting various provisions governing certain rights of an association with respect to certain property located within common-interest communities; enacting provisions governing the election, terms of office and qualifications of members of the executive board and officers of an association; providing for rules of procedure at a meeting of an association; making various other changes concerning common-interest communities; and providing other matters properly relating thereto.".