Condo reserve studies one step closer to law

OLYMPIA – With a 92 to 2 vote yesterday, the House of Representatives passed Senate Bill 6215, sponsored by Sen. Rodney Tom, D-Bellevue, requiring residential condominium associations to conduct annual reserve studies to determine condo owners’ future maintenance and repair costs of common areas. The bill also encourages residential condominium associations to establish reserve accounts based on their study to fund these repairs.

In addition, the bill requires that new condo buyers receive a condominium public offering statement or resale certificate outlining the current reserve study, or discloses that the association does not do a reserve study. This lets the buyer know up front that they will most likely be sharing in future, unforeseen or unplanned maintenance and repair expenses for the shared areas of the complex.

“Condominiums are the last bastion of affordable housing,” said Tom. “Owners should not be hit with or be surprised by high maintenance or repair bills because their condo association did not plan accordingly or disclose that fact to the purchaser.”

Reserve studies must include detailed information on projected expenditures and current reserve account information. SB 6215 also requires having a reserve study professional conduct a visual inspection every three years. If an association has not had a professional study in the past three years, one may be demanded if 20 percent or more of the unit owners agree. An association may refuse the demand if conducting the study would impose an unreasonable economic hardship on the association by using 10 percent or more of the association's annual budget.

SB 6215 passed the Senate on a 45 to 12 vote Feb. 11, and the amendments made in the House must be approved by the Senate before Governor Gregoire can sign the bill into law. The 2008 session is scheduled to adjourn March 13.

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