WUCIOA makes restrictions on use easier to adopted, like rental caps and smoking bans (But this is not legal advice for your specific association)

The Washington Uniform Common Interest Ownership Act (WUCIOA) is a new law that takes effect on July 1, 2018. Most of it only applies to HOAs and Condos created after that date. But existing HOAs and Condos can CHOOSE to adopt WUCIOA, and the legislature made it easier to do that than any other amendment to your CC&Rs or Declaration.

The law specifying how HOAs and old condos (before July of 1990) are regulated are vague have led to many disputes among owners; WUCIOA is intended to fix that problem. It provides more specific guidance on how the community is governed and about the rights and obligations of the owners and the association, and even banks that loan money to purchasers.

When we think of restrictions on use, we typically think of rental caps, restricting business use of a home, or prohibiting smoking in a community.

With regard to RESTRICTIONS ON USE, WUCIOA is friendlier to associations in several respects:

1. WUCIOA does NOT require 90% approval (and every affected unit) for amendments that restrict the use of a unit, as is in the current Condominium Act.
2. When the declaration requires a vote higher than 67% for approval, you can still amend the declaration if 67% of the owners vote yes, and no other member votes no. (The problems associated with apathetic owners are reduced.)
3. WUCIOA section 323 allows an association to adopt rules that restrict leasing of residential units to meet underwriting requirements of institutional lenders. This might allow a rental cap of 30% or 50% to be adopted by rule promulgated by the board, rather than by amendment requiring a vote of the ownership.

With regard to RESTRICTIONS ON USE, WUCIOA may be more difficult for associations or leaves unanswered questions in several respects:

1. WUCIOA would increase up to 67% the approval required for all declaration amendments, including use restrictions.
2. WUCIOA does ALLOW a higher percentage approval for restrictions on use.
3. Adopting WUCIOA would change the statute, but would not change the text of your declaration. So, if your declaration requires 90% to restrict use, that would still control, unless you can amend that provision out first.
4. If you have restrictions on use language in your declaration, then you probably cannot adopt a rental cap by rule.
5. It is very difficult to know what owner occupancy standards are being used by institutional lenders to know if a rental cap adopted by rule is enforceable under WUCIOA.

Depending on your community, WUCIOA may be an improvement over the HOA act, or either condominium statute. It is unclear if the new statutory provisions are automatically incorporated into the Declarations, or if they must be added, and conflicting old provisions deleted.

If you have questions about how WUCIOA might benefit your community, please contact us.