H. B. No. 407 As Introduced

Representative Raga

A BILL

To enact section 5312.01 of the Revised Code to 1
define and establish requirements for residential 2
community association developments. 3

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

       Section 1. That section 5312.01 of the Revised Code be 4
enacted to read as follows: 5

       Sec. 5312.01. (A) As used in this section: 6

       (1) "Common areas and facilities" means all property, 7
facilities, and improvements that homeowners in a residential 8
community association development own or lease in common or that 9
are held in trust or otherwise for the common benefit or use of 10
the residents in the development and for which the homeowners have 11
responsibility to repair, replace, and maintain. 12

       (2) "Developer" means any person who develops real estate as 13
a residential community association development. 14

       (3) "Homeowners association" means an association of 15
homeowners or other designated persons with the authority to 16
assess fees to replace, maintain, and repair the common areas and 17
facilities in a residential community association development. 18

       (4) "Residential community association development" means a 19
grouping of two or more homes developed pursuant to a common plan 20
that provides for common areas and facilities for which the 21
homeowners are responsible due to a covenant in the deed or other 22
condition of ownership. A condominium development, as defined in 23
section 5311.01 of the Revised Code, is not a residential 24
community association development. 25

       (B)(1) No developer, agent, or person associated with a 26
developer shall convey any home or real property in a residential 27
community association development unless the developer has 28
furnished, at a minimum, a two-year warranty covering the full 29
cost of labor and materials for the completion, repair, or 30
replacement of any aspect of the common areas and facilities that 31
the developer represents is included in the development or that 32
the developer otherwise is responsible for providing. The warranty 33
shall cover any completion, repair, or replacement that is 34
necessitated by a defect in material or workmanship, the failure 35
to complete an improvement or facility, or the failure to complete 36
an improvement or facility in a workerlike manner. 37

       (2) The warranty shall be effective for at least two years 38
following the time at which the developer no longer has a 39
controlling interest in the homeowners association and 40
relinquishes the management responsibilities for the common areas 41
and facilities to the homeowners association and for a longer time 42
as needed so that any facility or improvement for which a warranty 43
is required is covered for at least two years following its 44
completion. 45

       (3) The developer shall furnish a bond to accompany the 46
warranty with good and sufficient surety, conditioned on the 47
developer completing construction of the common areas and 48
facilities and making any repairs or replacement as this section 49
requires. The sole beneficiary or obligee of any default payment 50
shall be the homeowners association, which shall use the payment 51
to make necessary completions, repairs, or replacements, or to 52
reimburse the homeowners in proportion to the amount each paid 53
toward the completion, repair, or replacement. 54

       (C) The owner of each platted lot in a residential community 55
association development shall be assessed fees and charges for the 56
development's common areas and facilities in an amount equivalent 57
to the fees and charges assessed to the owner of a lot that 58
contains an occupied residential structure. A developer, as the 59
owner of a platted lot, shall be assessed fees and charges 60
pursuant to this division. 61

Section 1. That section 5312.01 of the Revised Code be	4
enacted to read as follows:	5

(1) "Common areas and facilities" means all property,	7
facilities, and improvements that homeowners in a residential	8
community association development own or lease in common or that	9
are held in trust or otherwise for the common benefit or use of	10
the residents in the development and for which the homeowners have	11
responsibility to repair, replace, and maintain.	12

(2) "Developer" means any person who develops real estate as	13
a residential community association development.	14

(3) "Homeowners association" means an association of	15
homeowners or other designated persons with the authority to	16
assess fees to replace, maintain, and repair the common areas and	17
facilities in a residential community association development.	18

(4) "Residential community association development" means a	19
grouping of two or more homes developed pursuant to a common plan	20
that provides for common areas and facilities for which the	21
homeowners are responsible due to a covenant in the deed or other	22
condition of ownership. A condominium development, as defined in	23
section 5311.01 of the Revised Code, is not a residential	24
community association development.	25

(B)(1) No developer, agent, or person associated with a	26
developer shall convey any home or real property in a residential	27
community association development unless the developer has	28
furnished, at a minimum, a two-year warranty covering the full	29
cost of labor and materials for the completion, repair, or	30
replacement of any aspect of the common areas and facilities that	31
the developer represents is included in the development or that	32
the developer otherwise is responsible for providing. The warranty	33
shall cover any completion, repair, or replacement that is	34
necessitated by a defect in material or workmanship, the failure	35
to complete an improvement or facility, or the failure to complete	36
an improvement or facility in a workerlike manner.	37

(2) The warranty shall be effective for at least two years	38
following the time at which the developer no longer has a	39
controlling interest in the homeowners association and	40
relinquishes the management responsibilities for the common areas	41
and facilities to the homeowners association and for a longer time	42
as needed so that any facility or improvement for which a warranty	43
is required is covered for at least two years following its	44
completion.	45

(3) The developer shall furnish a bond to accompany the	46
warranty with good and sufficient surety, conditioned on the	47
developer completing construction of the common areas and	48
facilities and making any repairs or replacement as this section	49
requires. The sole beneficiary or obligee of any default payment	50
shall be the homeowners association, which shall use the payment	51
to make necessary completions, repairs, or replacements, or to	52
reimburse the homeowners in proportion to the amount each paid	53
toward the completion, repair, or replacement.	54

(C) The owner of each platted lot in a residential community	55
association development shall be assessed fees and charges for the	56
development's common areas and facilities in an amount equivalent	57
to the fees and charges assessed to the owner of a lot that	58
contains an occupied residential structure. A developer, as the	59
owner of a platted lot, shall be assessed fees and charges	60
pursuant to this division.	61