During its most recent session, the Arizona legislature passed SB1476, a new law governing architectural review committees of planned communities in Arizona. The bill creates a new statute, A.R.S. § 33-1817, which goes into effect on August 2, 2012. This statute will impose significant requirements on associations which have enacted design guidelines, architectural guidelines, or other similar rules. Its requirements will trump any conflicting language in association governing documents, including CC&Rs. The new requirements include:
Architectural Committee Chair. At least one member of the association’s board must be a member of the architectural committee, and must also chair the architectural committee.
Security Deposits. For new construction or rebuilds of the “main residential structure,” an association may require a security deposit to secure completion of the construction or compliance with approved plans, but only if the association’s governing documents permit requiring such a deposit. The funds must be held in a trust account.
Final Design Approval Meeting. The committee must hold a final meeting to approve the plans, and the owner must have an opportunity to attend. If approved, the association must provide written acknowledgement that the approved plans are in compliance with the architectural rules in place at that time. The acknowledgement must also state that refund of the security deposit requires that construction be completed in accordance with the plans.
On-Site Inspections. The association must conduct at least two on-site formal reviews during construction to determine compliance with the approved plans. The owner must have an opportunity to attend the reviews.
Feedback. Within five days of each on-site inspection, the association must provide a written report to the owner identifying any violations or unapproved variations from the approved plans. Within thirty days of the second inspection, the association must provide a copy of the written report identifying any violations or unapproved variations that have come to the association’s attention. If no violations are present, the association must promptly release the owner’s security deposit. Otherwise, the association may hold the security deposit for an additional 180 days or until the receipt of a compliance report, whichever is earlier.
This new statute will impose significant changes for many associations in Arizona. Homeowners, associations, and developers should be aware of these changes and the effect they will have on CC&Rs throughout the state. If you would like to discuss these changes and how they impact your association or building plans, please contact Titus Brueckner & Levine PLC at 480-483-9600.