HB 470: "An Act relating to common interest ownership; and providing for an effective date."
00 HOUSE BILL NO. 470 01 "An Act relating to common interest ownership; and providing for an effective date." 02 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 03 * Section 1. AS 34.08.520(c) is amended to read: 04 (c) A declarant or dealer who offers a unit to a purchaser shall deliver a public 05 offering statement, or a preliminary version of the public offering statement that 06 reasonably reflects the contents of the public offering statement that is 07 subsequently recorded, in the manner required by AS 34.08.580(a). The person who 08 prepared all or a part of the public offering statement is liable under AS 34.08.580 and 09 34.08.670 for any false or misleading statement set out in the statement or for any 10 omission of a material fact from the statement with respect to the portion of the public 11 offering statement that the person prepared. If a declarant did not prepare any part of a 12 public offering statement, the declarant is not liable for a false or misleading statement 13 set out in the statement or for an omission of a material fact from the statement unless 14 the declarant had actual knowledge of the statement or omission or, in the exercise of 15 reasonable care, should have known of the statement or omission.
01 * Sec. 2. AS 34.08.530(a) is amended to read: 02 (a) Except as provided in (b) of this section, a public offering statement must 03 fully and accurately contain or disclose 04 (1) the name and principal address of the declarant and of the common 05 interest community and indicate whether the common interest community is a 06 condominium, cooperative, or planned community; 07 (2) a general description of the common interest community, 08 including, in a building constructed for residential purposes with horizontal 09 boundaries, the area of the interior surface of floors available for residential purposes 10 and, to the extent possible, the types, number, and declarant's schedule for the 11 commencement and completion of construction of buildings and amenities that the 12 declarant anticipates including in the common interest community; 13 (3) the number of units in the common interest community; 14 (4) copies and a brief narrative description of the significant features of 15 the declaration, other than plats and plans, and 16 (A) any recorded covenants, conditions, restrictions, and 17 reservations affecting the common interest community; 18 (B) the bylaws and any rules or regulations of the association; 19 (C) copies of any contracts and leases to be signed by 20 purchasers at closing; and 21 (D) a brief narrative description of any contracts or leases that 22 will or may be subject to cancellation by the association under AS 34.08.360; 23 (5) any current balance sheet and a projected budget for the 24 association, either within or as an exhibit to the public offering statement, for one year 25 after the date of the first conveyance to a purchaser, and the current budget of the 26 association, the name of the person who prepared the budget, and a statement of the 27 budget's assumptions concerning occupancy, assumptions concerning the calculation 28 of the amount of reserves certified by a certified architect or engineer, and inflation 29 factors, including, without limitation, 30 (A) a statement of the amount included in the budget as a 31 reserve for repairs and replacement including the estimated cost of repair or
01 replacement cost and the estimated useful life of the asset to be repaired or 02 replaced; 03 (B) a statement of any other reserves; 04 (C) the projected common expense assessment by category of 05 expenditures for the association; and 06 (D) the projected monthly common expense assessment for 07 each type of unit; 08 (6) any services not reflected in the budget that the declarant provides, 09 or expenses that the declarant pays and that the declarant expects may become a 10 common expense of the association at a subsequent time and the projected common 11 expense assessment attributable to each of those services or expenses for the 12 association and for each type of unit; 13 (7) any initial or special fee due from the purchaser at closing, together 14 with a description of the purpose and method of calculating the fee; 15 (8) a description of liens, defects, or encumbrances on or affecting the 16 title to the common interest community; 17 (9) a description of financing offered or arranged by the declarant; 18 (10) the terms and significant limitations of warranties provided by the 19 declarant, including statutory warranties and limitations on the enforcement of the 20 warranties or on damages; 21 (11) a statement that 22 (A) within 15 days after receipt of a public offering statement 23 or a preliminary version of the public offering statement that reasonably 24 reflects the contents of the public offering statement that is subsequently 25 recorded, a purchaser, before conveyance, may cancel any contract for 26 purchase of a unit from a declarant; 27 (B) if a declarant fails to provide a public offering statement to 28 a purchaser before conveying a unit, the purchaser may recover from the 29 declarant 10 percent of the sales price of the unit plus 10 percent of the share, 30 proportionate to the common expense liability of the unit, of any indebtedness 31 of the association secured by security interests encumbering the common
01 interest community; and 02 (C) a purchaser who receives the public offering statement, or 03 a preliminary version of the public offering statement that reasonably 04 reflects the contents of the public offering statement that is subsequently 05 recorded, more than 15 days before signing a contract cannot cancel the 06 contract; 07 (12) a statement of any unsatisfied judgments or pending suits against 08 the association, and the status of any pending suits material to the common interest 09 community of which a declarant has actual knowledge; 10 (13) a statement that a deposit made in connection with the purchase of 11 a unit will be held in an escrow account until closing and will be returned to the 12 purchaser if the purchaser cancels the contract under AS 34.08.580, together with the 13 name and address of the escrow agent; 14 (14) any restraints on alienation of any portion of the common interest 15 community and any restrictions 16 (A) on use, occupancy, and alienation of the unit; and 17 (B) on the amount for which a unit may be sold or on the 18 amount that may be received by a unit owner on sale, condemnation, or 19 casualty loss to the unit or to the common interest community, or on 20 termination of the common interest community; 21 (15) a description of the insurance coverage provided for the benefit of 22 unit owners; 23 (16) current or expected fees or charges to be paid by a unit owner for 24 the use of the common elements and other facilities related to the common interest 25 community; 26 (17) the extent to which financial arrangements have been provided for 27 completion of improvements that the declarant is obligated to build under 28 AS 34.08.690; 29 (18) a brief narrative description of zoning and other land use 30 requirements affecting the common interest community; 31 (19) each unusual and material circumstance, feature, or characteristic
01 of the common interest community and the units; and 02 (20) in a cooperative, 03 (A) whether each unit owner will be entitled, for federal, state, 04 and local income tax purposes, to a pass-through of deductions for payments 05 made by the association for real estate taxes and interest paid the holder of a 06 security interest encumbering the cooperative; and 07 (B) a statement as to the effect on each unit owner if the 08 association fails to pay real estate taxes or payments due the holder of a 09 security interest encumbering the cooperative. 10 * Sec. 3. AS 34.08.580(a) is amended to read: 11 (a) A person required to deliver a public offering statement under 12 AS 34.08.520(c) shall provide each purchaser with a copy of the public offering 13 statement and each amendment to the statement, or a preliminary version of the 14 public offering statement that reasonably reflects the contents of the public 15 offering statement that is subsequently recorded, before conveyance of the unit, 16 and not later than the date of a contract of sale. If a purchaser is not given the public 17 offering statement, or a preliminary version of the public offering statement that 18 reasonably reflects the contents of the public offering statement that is 19 subsequently recorded, more than 15 days before execution of a contract for the 20 purchase of a unit, the purchaser, before conveyance, may cancel the contract within 21 15 days of receipt of the public offering statement or preliminary version of the 22 public offering statement. 23 * Sec. 4. This Act takes effect immediately under AS 01.10.070(c).