Common Ownership Communities - Oversight, Governing Document Database, and Local Commissions

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb0402*

HOUSE BILL 402
N1, I3, P1 6lr1697
HB 306/25 – ENT CF SB 981
By: Delegates Holmes, Acevero, Boyce, Kaufman, McCaskill, Moreno, Pasteur,
Phillips, Ross, Simmons, Stewart, Stinnett, Toles, White Holland, Williams,
and Wims
Introduced and read first time: January 22, 2026
Assigned to: Economic Matters
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 9, 2026

CHAPTER ______

AN ACT concerning 1

Common Ownership Communities – Ombudsman Unit Oversight, Governing 2
Document Database, and Local Commissions 3

FOR the purpose of establishing the Common Ownership Community Ombudsman Unit 4
Oversight Division in the Division of Consumer Protection in the Office of the 5
Attorney General Department of Housing and Community Development to receive 6
and respond to certain complaints; requiring common ownership communities to file 7
certain documents with the Department of Housing and Community Development ; 8
requiring the Department to establish a certain database; establishing requirements 9
for a local common ownership commission established by the local government of a 10
county; and generally relating to common ownership communities. 11

BY adding to 12
Article – Commercial Law 13
Section 13–207 14
Annotated Code of Maryland 15
(2025 Replacement Volume) 16

BY adding to 17
Article – Housing and Community Development 18
Section 2–304 19
Annotated Code of Maryland 20
(2019 Replacement Volume and 2025 Supplement) 21
2 HOUSE BILL 402

BY adding to 1
Article – Real Property 2
Section 11C–101 through 11C–114 11C–206 to be under the new title “Title 11C. 3
Local Commissions on Common Ownership Communities” 4
Annotated Code of Maryland 5
(2023 Replacement Volume and 2025 Supplement) 6

BY repealing and reenacting, without amendments, 7
Article – State Finance and Procurement 8
Section 6–226(a)(1) and (2)(i) and (ii) 9
Annotated Code of Maryland 10
(2021 Replacement Volume and 2025 Supplement) 11

BY repealing and reenacting, with amendments, 12
Article – State Finance and Procurement 13
Section 6–226(a)(2)(iii)212. and 213. 14
Annotated Code of Maryland 15
(2021 Replacement Volume and 2025 Supplement) 16

BY adding to 17
Article – State Finance and Procurement 18
Section 6–226(a)(2)(iii)214. 19
Annotated Code of Maryland 20
(2021 Replacement Volume and 2025 Supplement) 21

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 22
That the Laws of Maryland read as follows: 23

Article – Commercial Law 24

13–207. 25

(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 26
INDICATED. 27

(2) “COMMON OWNERSHIP COMMUNITY” MEANS: 28

(I) A COOPERATIVE HOUSING CORPORATION AS DEFINED IN § 29
5–6B–01 OF THE CORPORATIONS AND ASSOCIATIONS ARTICLE; 30

(II) A CONDOMINIUM AS DEFIN ED IN § 11–101 OF THE REAL 31
PROPERTY ARTICLE; OR 32

(III) A HOMEOWNERS ASSOCIATION AS DEFINED IN § 11B–101 OF 33
THE REAL PROPERTY ARTICLE. 34
HOUSE BILL 402 3

(3) “GOVERNING BODY” MEANS: 1

(I) THE COUNCIL OF UNIT OWNERS OF A CONDOMINIUM; 2

(II) THE BOARD OF DIRECTOR S OF A COOPERATIVE H OUSING 3
CORPORATION; 4

(III) A HOMEOWNERS ASSOCIATION, BOARD OF DIRECTORS , OR 5
ANY OTHER ENTITY EST ABLISHED TO GOVERN A PROPERTY SUBJECT TO AN 6
INSTRUMENT THAT IMPOSES ON LOTS, OR ON THE OWNERS OR OCCUPANTS OF LOTS, 7
ANY MANDATORY FEE IN CONNECTION WITH THE PROVISION OF SERVICE S OR 8
OTHERWISE FOR THE BENEFIT OF SOME OR ALL OF THE LOTS; OR 9

(IV) ANY OTHER BODY AUTHOR IZED TO ADOPT RULES OR 10
REGULATIONS GOVERNIN G A CONDOMINIUM , COOPERATIVE HOUSING 11
CORPORATION, OR HOMEOWNERS ASSOCIATION. 12

(4) “LOCAL COMMISSION ” MEANS A COMMISSION O N COMMON 13
OWNERSHIP COMMUNITIES ESTABLISHED BY A C OUNTY, IN ACCORDANCE WITH § 14
11C–101 OF THE REAL PROPERTY ARTICLE. 15

(5) “MEMBER” MEANS: 16

(I) AN OCCUPANT OR A UNIT OWNER UNDER THE MARYLAND 17
CONDOMINIUM ACT; 18

(II) A LOT OWNER UNDER THE MARYLAND HOMEOWNERS 19
ASSOCIATION ACT; OR 20

(III) A MEMBER OF A COOPERATIVE HOUSING CORPORATION AS 21
DEFINED IN § 5–6B–01 OF THE CORPORATIONS AND ASSOCIATIONS ARTICLE. 22

(6) “UNIT” MEANS THE COMMON OWNERSHIP COMMUNITY 23
OMBUDSMAN UNIT IN THE OFFICE OF THE ATTORNEY GENERAL. 24

(B) THERE IS A COMMON OWNERSHIP COMMUNITY OMBUDSMAN UNIT IN 25
THE DIVISION OF CONSUMER PROTECTION. 26

(C) THE PURPOSE OF THE UNIT IS: 27

(1) TO MONITOR CHANGES IN FEDERAL AND STATE LAWS RELATING 28
TO COMMON OWNERSHIP COMMUNITIES; 29
4 HOUSE BILL 402

(2) TO PUBLISH INFORMATIO N CONCE RNING COMMON OWNERSH IP 1
COMMUNITIES ON THE WEBSITE OF THE OFFICE OF THE ATTORNEY GENERAL; 2

(3) TO ASSIST MEMBERS IN UNDERSTANDING RIGHTS AND 3
PROCESSES AVAILABLE TO MEMBERS UNDER LAWS AND REGULATIONS GOVERNING 4
COMMON OWNERSHIP COMMUNITIES; AND 5

(4) ON REQUEST, TO PROVIDE REFERRALS TO PUBLIC AND PRIVAT E 6
ALTERNATIVE DISPUTE RESOLUTION SERVICES, WITH A GOAL OF REDUC ING AND 7
RESOLVING CONFLICTS AMONG GOVERNING BODIES AND MEMBERS. 8

(D) THE UNIT SHALL INCLUDE: 9

(1) A FULL–TIME COMMON OWNERSHIP COMMUNITY OMBUDSMAN; 10
AND 11

(2) STAFF AS PROVIDED IN THE STATE BUDGET. 12

(E) (1) THE ATTORNEY GENERAL SHALL APPOINT THE COMMON 13
OWNERSHIP COMMUNITY OMBUDSMAN. 14

(2) THE COMMON OWNERSHIP COMMUNITY OMBUDSMAN MUST BE A 15
MEMBER OF THE MARYLAND BAR. 16

(F) THE UNIT SHALL RECEIVE AND RESPOND TO COMPLAINTS BY MEMBERS 17
REGARDING FINAL ADVE RSE DECISIONS BY A G OVERNING BODY OR COM MON 18
OWNERSHIP COMMUNITY MANAGER. 19

(G) IN RESPONSE TO A COMP LAINT, OR ON THE INITIATIVE OF THE 20
OMBUDSMAN, THE UNIT SHALL: 21

(1) REFER THE COMPLAINT TO AN APPROPRIATE LOCAL COMMISSION 22
FOR FURTHER REVIEW O F WHETHER THE FINAL ADVERSE DECISION CON FLICTS 23
WITH LAWS OR REGULAT IONS GOVERNING COMMON OWNERSHIP COMMUNITIES IN 24
THE JURISDICTION; OR 25

(2) MAKE A DETERMINATION OF WHETHER THE FIN AL ADVERSE 26
DECISION CONFLICTS W ITH LAWS OR REGULATI ONS GOVERNING COMMON 27
OWNERSHIP COMMUNITIE S AND PROMPTLY NOTIF Y THE COMPLAINANT OF THE 28
DETERMINATION. 29

HOUSE BILL 402 5

(H) (1) IF THE UNIT DETERMINES THAT A FINAL ADVERSE DECI SION 1
CONFLICTS WITH LAWS OR REGULATIONS GOVER NING COMMON OWNERSHI P 2
COMMUNITIES, THE UNIT SHALL PROMPTLY NOTIFY THE MEMBER, THE GOVERNING 3
BOARD, AND, IF APPLICABLE , THE COMMON OWNERSHIP COMMUNITY MANAGER 4
THAT THE ADVERSE DEC ISION CONFLICTS WITH LAWS OR REGULATIONS 5
GOVERNING COMMON OWNERSHIP COMMUNITIES. 6

(2) IF WITHIN 1 YEAR AFTER ISSUING A DETERMINATION THE 7
OMBUDSMAN RECEIVES A SUBSEQUENT COMPLAINT OF A FINAL ADVERSE DECISION 8
FOR THE SAME VIOLATI ON, THE UNIT SHALL REFER THE MATTER TO THE 9
APPROPRIATE LOCAL COMMISSION. 10

(I) (1) ON OR BEFORE DECEMBER 1, 2028, AND EACH DECEMBER 1 11
THEREAFTER, THE UNIT SHALL REPORT TO THE DEPARTMENT OF HOUSING AND 12
COMMUNITY DEVELOPMENT AND, IN ACCORDANCE WITH § 2–1257 OF THE STATE 13
GOVERNMENT ARTICLE, THE GENERAL ASSEMBLY ON THE ACTIV ITIES OF THE 14
UNIT DURING THE REPORTING PERIOD. 15

(2) THE REPORT REQUIRED U NDER PARAGRAPH (1) OF THIS 16
SUBSECTION SHALL INCLUDE: 17

(I) THE NUMBER OF COMPLAINTS RECEIVED BY THE UNIT; 18

(II) THE TYPES OF ASSISTANCE REQUESTED; 19

(III) ACTIONS TAKEN BY THE UNIT; 20

(IV) THE NUMBER OF REFERRALS MADE TO LO CAL 21
COMMISSIONS; AND 22

(V) DATA ON DISPOSITIONS AND OUTCOMES OF COMP LAINTS 23
RECEIVED. 24

Article – Housing and Community Development 25

2–304. 26

(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 27
INDICATED. 28

(2) “COMMON OWNERSHIP COMMUNITY” HAS THE MEANING STATED 29
IN § 2–303 OF THIS SUBTITLE. 30

6 HOUSE BILL 402

(3) “GOVERNING DOCUMENTS” MEANS AN OFFERING ST ATEMENT, A 1
DECLARATION, BYLAWS, RULES, REGULATIONS, A PROPRIETARY LEASE , OR ANY 2
OTHER SIMILAR DOCUMENT OF A COMMON OWNERSHIP COMMUNITY. 3

(B) (1) A COMMON OWNERSHIP COM MUNITY LOCATED IN TH E STATE 4
SHALL FILE WITH THE DEPARTMENT A COPY OF THE GOVERNING DOCUMENTS, AND 5
ANY AMENDMENTS TO THE GOVERNING DOCUMENTS, OF THE COMMON OWNERSHIP 6
COMMUNITY. 7

(2) A COMMON OWNERSHIP COM MUNITY THAT FAILS TO MAKE A 8
FILING REQUIRED UNDE R PARAGRAPH (1) OF THIS SUBSECTION I S SUBJECT TO A 9
FINE OF $500. 10

(C) (1) THE DEPARTMENT SHALL DEVELOP AND MAINTAIN A D ATABASE 11
OF GOVERNING DOCUMEN TS FILED WITH THE DEPARTMENT UNDER SUBS ECTION 12
(B) OF THIS SECTION ACCE SSIBLE TO THE PUBLIC THROUG H THE DEPARTMENT’S 13
WEBSITE DESCRIBED IN § 2–303 OF THIS SUBTITLE. 14

(2) THE DEPARTMENT MAY CHARGE THE FOLLOWING FEES F OR 15
FILINGS REQUIRED UNDER THIS SECTION: 16

(I) FOR AN INITIAL FILING, UP TO $100; AND 17

(II) FOR ANY AMENDMENT TO A GOVERNING DOCUMENT, UP TO 18
$25. 19

Article – Real Property 20

TITLE 11C. LOCAL COMMISSIONS ON COMMON OWNERSHIP COMMUNITIES. 21

SUBTITLE 1. LOCAL COMMISSIONS ON COMMON OWNERSHIP COMMUNITIES. 22

11C–101. 23

(A) IN THIS TITLE SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 24
INDICATED. 25

(B) “COMMON ELEMENT” MEANS: 26

(1) ANY PORTION OF A COMM ON OWNERSHIP COMMUNI TY OTHER 27
THAN THE UNITS OF A CONDOMINIUM OR COOPERATIVE; AND 28

HOUSE BILL 402 7

(2) PROPERTY THAT IS OWNE D OR LEASED BY A HOM EOWNERS 1
ASSOCIATION. 2

(C) (1) “COMMON OWNERSHIP COMMUNITY” MEANS: 3

(I) A CONDOMINIUM AS DEFINED IN § 11–101 OF THIS ARTICLE 4
THAT IS USED FOR RESIDENTIAL PURPOSES; 5

(II) A COOPERATIVE HOUSING CORPORATION AS DEFINED IN § 6
5–6B–01 OF THE CORPORATIONS AND ASSOCIATIONS ARTICLE; AND 7

(III) A HOMEOWNERS ASSOCIATION AS DEFINED IN § 11B–101 OF 8
THIS ARTICLE. 9

(2) “COMMON OWNERSHIP COMM UNITY” DOES NOT INCLUDE A 10
TIME–SHARE PROJECT AS DEFINED IN § 11A–101 OF THIS ARTICLE. 11

(D) (1) “DISPUTE” MEANS A DISAGREEMENT BETWEEN AT LEAST TWO 12
PARTIES THAT INVOLVES: 13

(I) THE AUTHORITY OF A GO VERNING BODY OF A CO MMON 14
OWNERSHIP COMMUNITY TO: 15

1. REQUIRE OR PROHIBIT A NY ACTION INVOLVING A 16
UNIT OR COMMON ELEMENT; 17

2. REQUIRE ANY PERSON TO PAY A FEE , A FINE, OR AN 18
ASSESSMENT; 19

3. SPEND COMMON OWNERSHIP COMMUNITY FUNDS; OR 20

4. ALTER OR ADD TO A COMMON ELEMENT; OR 21

(II) THE FAILURE OF A GOVE RNING BODY OF A COMM ON 22
OWNERSHIP COMMUNITY TO: 23

1. PROPERLY CONDUCT AN ELECTION; 24

2. GIVE ADEQUATE NOTICE OF A MEETING OR ANY 25
OTHER ACTION; 26

3. PROPERLY CONDUCT A MEETING; 27

8 HOUSE BILL 402

4. PROPERLY ADOPT A BUDGET OR RULES; 1

5. MAINTAIN OR AUDIT BOOKS AND RECORDS; 2

6. ALLOW INSPECTION OF BOOKS AND RECORDS; 3

7. MAINTAIN OR REPAIR A COMMON ELEMENT IF TH E 4
FAILURE RESULTS IN SIGNIFICANT PERSONAL INJURY OR PROPERTY DAMAGE; OR 5

8. EXERCISE ITS JUDGMENT IN GOOD FAITH 6
CONCERNING THE ENFOR CEMENT OF THE GOVERN ING DOCUMENTS AGAINS T ANY 7
PERSON THAT IS SUBJECT TO THOSE DOCUMENTS. 8

(2) “DISPUTE” DOES NOT INCLUDE A D ISAGREEMENT THA T 9
INVOLVES: 10

(I) TITLE TO ANY UNIT OR COMMON ELEMENT; 11

(II) THE PERCENTAGE INTERE ST OR VOTE ALLOCABLE TO A 12
UNIT; 13

(III) THE INTERPRETATION OR ENFORCEMENT OF ANY 14
WARRANTY; 15

(IV) THE COLLECTION OF AN ASSESSMENT VALIDLY L EVIED 16
AGAINST A PARTY; OR 17

(V) THE EXERCISE OF THE J UDGMENT OR DISCRETIO N OF A 18
COMMON OWNERSHIP COMMUNITY REGARDING ANY LEGALLY AUTHORIZED ACTION. 19

(E) “GOVERNING BODY OF A COMMON OWNERSHIP COMMUNITY” MEANS: 20

(1) THE COUNCIL OF UNIT OWNERS OF A CONDOMINIUM; 21

(2) THE BOARD OF DIRECTORS OF A CO OPERATIVE HOUSING 22
CORPORATION; 23

(3) A HOMEOWNERS ASSOCIATION, BOARD OF DIRECTORS , OR ANY 24
OTHER ENTITY ESTABLISHED TO GOVERN A PROPERTY SUBJECT TO AN INSTRUMENT 25
THAT IMPOSES ON LOTS , OR ON THE OWNERS OR OCCUPANTS OF LOTS , ANY 26
MANDATORY FEE IN CONNECTION WITH THE PROVISION O F SERVICES OR 27
OTHERWISE FOR THE BENEFIT OF SOME OR ALL OF THE LOTS; OR 28

HOUSE BILL 402 9

(4) ANY OTHER BODY AUTHOR IZED TO ADOPT RULES OR 1
REGULATIONS GOVERNIN G A CONDOMINIUM , COOPERATIVE HOUSING 2
CORPORATION, OR HOMEOWNERS ASSOCIATION. 3

(F) (1) “GOVERNING DOCUMENT” MEANS: 4

(I) THE MASTER DEED , DECLARATION, INCORPORATION 5
DOCUMENT, BYLAWS, OR RULES OF ANY COMMON OWNERSHIP COMMUNITY; 6

(II) A WRITTEN PRIVATE AGRE EMENT BETWEEN PARTIE S 7
CONCERNING THE OPERATION OF THE COMMUNITY OR MAINTENANCE OR CONTROL 8
OF COMMON OR LIMITED COMMON PROPERTY; OR 9

(III) A DOCUMENT CONCERNING THE OPERATION OR 10
GOVERNANCE OF A COMMON OWNERSHIP COMMUNITY. 11

(2) “GOVERNING DOCUMENT” DOES NOT INCLUDE A L EASE UNLESS 12
THE LEASE PROVIDES THAT IT MAY BE ENFORCED UNDER THIS TITLE SUBTITLE. 13

(G) “LOCAL COMMISSION” MEANS A COMMISSION ON COMMON OWNERSHIP 14
COMMUNITIES ESTABLIS HED BY A COUNTY IN A CCORDANCE WITH THIS TITLE 15
SUBTITLE. 16

(H) “LOCAL GOVERNMENT” MEANS: 17

(1) THE COUNTY COMMISSION ERS OR COUNTY COUNCIL OF A 18
COUNTY; 19

(2) IF THE CHARTER OF THE COUNTY PROVIDES FOR A COUNTY 20
EXECUTIVE, THE COUNTY EXECUTIVE AND THE COUNTY COUNCIL; OR 21

(3) THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY. 22

(I) “OWNER” MEANS: 23

(1) A UNIT OWNER IN A CONDOMINIUM; 24

(2) A MEMBER OF A COOPERATIVE HOUSING CORPORATION; OR 25

(3) A LOT OWNER IN A HOMEOWNERS ASSOCIATION. 26

11C–102. 27

10 HOUSE BILL 402

THE PROVISIONS OF THI S TITLE SUBTITLE SUPERSEDE ANY INCONS ISTENT 1
PROVISIONS OF LOCAL LAW THAT CONFLICT WI TH THIS TITLE SUBTITLE TO THE 2
EXTENT OF THE CONFLICT. 3

11C–103. 4

(A) A LOCAL COMMISSION ON COMMON OWNERSHIP COM MUNITIES 5
ESTABLISHED BY THE L OCAL GOVERNMENT OF A COUNTY BY LOCAL LAW SHALL 6
COMPLY WITH THE REQUIREMENTS OF THIS TITLE SUBTITLE. 7

(B) (1) (I) SUBJECT TO SUBPARAGRA PH (II) OF THIS PARA GRAPH, A 8
LOCAL COMMISSION SHALL INCLUDE MEMBERS WHO: 9

1. ARE OWNERS IN A COMMON OWNERSHIP COMMUNITY; 10
AND 11

2. REPRESENT PROFESSIONS ASSOCIATED WITH 12
COMMON OWNERSHIP COM MUNITIES, INCLUDING INDIVIDUAL S INVOLVED IN 13
HOUSING DEVELOPMENT OR REAL ESTATE SA LES, DEVELOPERS, OR ATTORNEYS 14
WHO REPRESENT COMMON OWNERSHIP COMMUNITIES INCLUDING AT LEAST ONE 15
MEMBER WHO IS A LICENSED COMMON OWNERSHIP COMMUNITY MANAGER. 16

(II) THE LOCAL GOVERNMENT SHALL DETERMINE THE TOTAL 17
NUMBER OF MEMBERS OF THE LOCAL COMMISSION. 18

(2) THE FOLLOWING INDIVID UALS SHALL SERVE AS NONVOTING 19
MEMBERS OF A LOCAL COMMISSION: 20

(I) A DESIGNEE OF THE LOCAL GOVERNMENT; AND 21

(II) A DESIGNEE OF A COUNTY AGENCY DEALING WITH: 22

1. PLANNING; 23

2. ENVIRONMENT; 24

3. PERMITTING; 25

4. TRANSPORTATION; OR 26

5. HOUSING AND COMMUNITY AFFAIRS. 27

HOUSE BILL 402 11

(C) THE CHAIR AND VICE CH AIR OF A LOCAL COMMI SSION SHALL BE 1
ELECTED FROM AMONG THE VOTING MEMBERSHIP OF THE LOCAL COMMISSION. 2

(D) (1) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , A LOCAL 3
GOVERNMENT ESTABLISHING A LOCAL COMMISSION SHA LL ADOPT PROCEDURES 4
FOR THE APPOINTMENT AND TERMS OF MEMBERS OF THE LOCAL COMMISSION. 5

(2) A MEMBER OF A LOCAL COMMISSION MAY NOT SERVE MORE THAN 6
TWO CONSECUTIVE TERMS. 7

11C–104. 8

(A) A MAJORITY OF THE TOTA L MEMBERSHIP OF A LOCA L COMMISSION 9
SHALL CONSTITUTE A QUORUM. 10

(B) A LOCAL COMMISSION SHA LL MEET AT LEAST MON THLY AND 11
DETERMINE THE TIMES AND PLACES OF ITS MEETINGS. 12

(C) A MEMBER OF A LOCAL COMMISSION: 13

(1) MAY NOT RECEIVE COMPENSATION AS A MEMBER OF THE LOCAL 14
COMMISSION; BUT 15

(2) IS ENTITLED TO REIMBU RSEMENT FOR EXPENSES UNDER THE 16
STANDARD COUNTY TRAVEL REGULATIONS. 17

(D) (1) A LOCAL COMMISSION SHALL: 18

(I) ADOPT RULES OF PROFES SIONAL CONDUCT AS 19
APPROPRIATE FOR MEMBERS AND STAFF; 20

(II) KEEP A RECORD OF ITS PROCEEDINGS; 21

(III) EXAMINE THE NEEDS OF COMMON OWNERSHIP 22
COMMUNITIES IN THE COUNTY; 23

(IV) ADVISE COUNTY GOVERNM ENT AND APPROPRIATE STATE 24
AND FEDERAL AGENCIES ON MATTERS RELATING TO COMMON OWNERSHIP 25
COMMUNITIES; AND 26

(V) PROVIDE TRAINING ON THE RESPONSIBILITIES OF A LOCAL 27
COMMISSION’S MEMBERS TO THE GOV ERNING BODY OF A COM MON OWNERSHIP 28
COMMUNITY BY: 29
12 HOUSE BILL 402

1. DEVELOPING AN EDUCATI ONAL CURRICULUM FOR 1
NEW MEMBERS; AND 2

2. APPROVING AN ALTERNAT IVE EDUCATIONAL 3
CURRICULUM FOR NEW MEMBERS. 4

(2) A LOCAL COMMISSION MAY: 5

(I) EMPLOY STAFF AS AUTHORIZED BY A LOCAL GOVERNMENT; 6

(II) ESTABLISH A PROCESS F OR RESOLVING DISCIPL INARY 7
MATTERS PENDING BEFO RE THE LOCAL COMMISS ION THROUGH NONJUDIC IAL 8
DISPUTE RESOLUTION PROCESSES; 9

(III) DEVELOP EDUCATIONAL AND TRAINING OPPORTUNITI ES 10
FOR GOVERNING BODIES; 11

(IV) ADOPT ADDITIONAL BYLA WS NECESSARY TO CARR Y OUT 12
THE BUSINESS OF THE LOCAL COMMISSION; AND 13

(V) ADOPT ANY ADDITIONAL REGULATIONS, PROCEDURES, OR 14
STANDARDS CONSISTENT WITH THE MISSI ON OF THE LOCAL COMM ISSION AND TO 15
CARRY OUT THE REQUIREMENTS OF THIS TITLE SUBTITLE. 16

11C–105. 17

(A) A LOCAL LAW ESTABLISHI NG A LOCAL COMMISSIO N SHALL REQUIRE 18
COMMON OWNERSHIP COMMUNITIES IN THE COUNTY TO REGISTER WITH THE LOCAL 19
COMMISSION ANNUALLY ON A FORM THAT IDENTIFIES: 20

(1) THE ELECTED LEADERSHI P OF THE COMMON OWNE RSHIP 21
COMMUNITY; AND 22

(2) THE MANAGING AGENTS O F THE COMMON OWNERSH IP 23
COMMUNITY. 24

(B) A COMMON OWNERSHIP COM MUNITY THAT FAILS TO REGISTER OR 25
MAKES A FALSE STATEM ENT ON A REGISTRATIO N FORM IS INELIGIBLE T O FILE A 26
DISPUTE. 27

11C–106. 28

HOUSE BILL 402 13

(A) A LOCAL LAW ESTABLISHI NG A LOCAL COMMISSIO N MAY AUTHORIZE 1
THE COLLECTION OF A REASONABLE FEE FOR SERVICES PROVIDED BY THE LOCAL 2
COMMISSION. 3

(B) ANY AUTHORIZED FEE SH ALL BE USED TO COVER THE COST OF 4
MAINTAINING THE LOCAL COMMISSION AND MAY INCLUDE: 5

(1) A PER UNIT ANNUAL CHAR GE TO COMMON OWNERSH IP 6
COMMUNITIES TO RENEW REGISTRATION; 7

(2) FEES FOR DISPUTE RESOLUTION UNDER § 11C–110 OF THIS TITLE 8
SUBTITLE, SERVICE, AND TECHNICAL ASSISTANCE; AND 9

(3) A PER UNIT CHARGE TO DEVELOPERS FOR THE RECORDATION OF 10
DOCUMENTS. 11

(C) IF THE COLLECTION OF A FEE BY A LOCAL COMMISSION IS AUTHORIZED 12
UNDER THIS SECTION , THE LOCAL COMMISSION SHALL PUBLISH THE FE E 13
SCHEDULE. 14

11C–107. 15

A LOCAL GOVERNMENT THA T ESTABLISHES A LOCAL COMMISSION S HALL 16
DESIGNATE A COUNTY AGENCY OR AN OFFICE TO: 17

(1) DISSEMINATE EDUCATIONAL MATERIALS REGARDING PROGRAMS 18
THAT ASSIST COMMON OWNERSHIP COMMUNITIES; 19

(2) CONDUCT EDUCATIONAL P ROGRAMS TO PROMOTE T HE 20
OPERATION OF COMMON OWNERSHIP COMMUNITIES; 21

(3) MAINTAIN A LIST OF: 22

(I) COMMON OWNERSHIP COMM UNITIES IN THE COUNT Y, 23
INCLUDING THE LEADERSHIP OF EACH COMMON OWNERSHIP COMMUNITY; AND 24

(II) PROFESSIONAL MANAGEMENT COMPANIES THAT PR OVIDE 25
SERVICES TO COMMON OWNERSHIP COMMUNITIES IN THE COUNTY; 26

(4) MAINTAIN INFORMATION AND A REFERRAL SYSTE M FOR ALL 27
COUNTY SERVICES RELATED TO COMMON OWNERSHIP COMMUNITIES; 28

(5) MAINTAIN A COLLECTION OF GOVERNING DOCUMENTS; 29
14 HOUSE BILL 402

(6) PROVIDE TECHNICAL ASS ISTANCE TO GOVERNING BODIES ON 1
MATTERS INCLUDING: 2

(I) LEADERSHIP TRANSITION; 3

(II) ELECTIONS; 4

(III) ADOPTION OF RULES; 5

(IV) ENFORCEMENT OF RULES; 6

(V) SELECTION OF ASSOCIATION MANAGERS; AND 7

(VI) STORMWATER MANAGEMENT; 8

(7) MAINTAIN AN OPERATION S MANUAL TO GUIDE CO MMON 9
OWNERSHIP COMMUNITY LEADERSHIP; 10

(8) ADVISE COMMON OWNERSHIP COMMUNITIES AND PROFESSIONAL 11
ASSOCIATION MANAGERS OF CHANGES IN THE LA WS AND REGULATIONS T HAT 12
AFFECT THEIR COMMUNITIES OR OPERATIONS; AND 13

(9) OPERATE A DISPUTE RES OLUTION PROCESS TO F URNISH 14
MEDIATION AND ADMINISTRATIVE HEARINGS. 15

11C–108. 16

(A) A LOCAL COMMISSION MAY HEAR ANY DISPUTE BETWEEN PARTIES. 17

(B) A PARTY MAY NOT FILE A DISPUTE WITH A LOCAL COMMISSION UNTIL: 18

(1) THE PARTY HAS MADE A GOOD FAITH EFFORT TO EXHAUST ALL 19
PROCEDURES AND REMEDIES PROVIDED BY THE GOVE RNING DOCUMENTS OF T HE 20
COMMON OWNERSHIP COMMUNITY; AND 21

(2) AT LEAST 60 DAYS AFTER ANY PROCEDURE OR REMEDY HAS BEEN 22
INITIATED WITH THE GOVERNING BODY OF A COMMON OWNERSHIP COMMUNITY. 23

(C) (1) IF THE GOVERNING BODY OF A COMMON OWNERSHIP COMMUNITY 24
DETERMINES THAT A DI SPUTE EXISTS , THE GOVERNING BODY O F THE COMMON 25
OWNERSHIP COMMUNITY SHALL NOTIFY THE OTH ER PARTIES OF THE OP TION TO 26
FILE THE DISPUTE WITH A LOCAL COMMISSION. 27
HOUSE BILL 402 15

(2) THE GOVERNING BODY OF A COMMON OWNERSHIP C OMMUNITY 1
MAY NOT TAKE ACTION TO ENFOR CE OR IMPLEMENT THE DECISION OF THE 2
GOVERNING BODY FOR 14 DAYS FOLLOWING NOTIFICATION OF ALL OTHER PARTIES. 3

(D) EXCEPT AS PROVIDED IN § 11C–109 OF THIS TITLE SUBTITLE, ON THE 4
FILING OF A DISPUTE WITH A LOCAL COMMISS ION, THE DECISION OF THE 5
GOVERNING BODY OF A COMMON OWNERSHIP COMMUNITY SHALL BE STAY ED AND 6
MAY NOT BE ENFORCED OR IMPLEMENTED, OTHER THAN BY FILING A CIVIL ACTION, 7
UNTIL THE COMPLETION OF THE DISPUTE PROCESS. 8

11C–109. 9

(A) (1) AT ANY TIME AFTER A D ISPUTE IS FILED, THE GOVERNING BODY 10
OF A COMMON OWNERSHI P COMMUNITY MAY SUBM IT A REQUEST TO LIFT AN 11
AUTOMATIC STAY UNDER § 11C–108 OF THIS TITLE SUBTITLE. 12

(2) IF A HEARING PANEL HA S NOT BEEN APPOINTED UNDER § 13
11C–112 OF THIS TITLE SUBTITLE, THE LOCAL COMMISSION SHALL AUTHORIZE A 14
SPECIAL STANDING PANEL TO CONSIDER REQUESTS FOR RELIEF FROM STAYS. 15

(3) THE SPECIAL PANEL SHALL INCLUDE: 16

(I) THREE VOTING MEMBERS OF THE LOCAL COMMISS ION 17
DESIGNATED BY THE CHAIR; AND 18

(II) AT LEAS T ONE MEMBER DESCRIB ED UNDER § 19
11C–103(B)(1)(I)1 OF THIS TITLE SUBTITLE AND AT LEAST ONE MEM BER 20
DESCRIBED UNDER § 11C–103(B)(1)(I)2 OF THIS TITLE SUBTITLE. 21

(B) (1) A GOVERNING BODY OF A COMMON OWNERSHIP COM MUNITY 22
THAT REQUESTS RELIEF FROM A STAY SHALL SERVE A COPY OF ITS REQUEST ON ANY 23
PARTY NAMED IN THE DISPUTE BY CERTIFIED MAIL OR PERSONAL SERVICE. 24

(2) A CERTIFICATE OF SERVI CE SHALL ACCOMPANY A NY REQUEST 25
SUBMITTED UNDER THIS SECTION. 26

(3) A PARTY SERVED WITH A COPY OF THE REQUEST SHALL FILE ANY 27
OPPOSITION TO THE REQUEST WITHIN 10 DAYS AFTER RECEIVING SERVICE. 28

(C) EXCEPT AS PROVIDED IN SUBSECTION (D) OF THIS SECTION, A REQUEST 29
FOR RELIEF FROM A ST AY MAY BE GRANTED ON LY IF THE ASSIGNED P ANEL FINDS 30
THAT: 31
16 HOUSE BILL 402

(1) ENFORCING THE STAY WO ULD RESULT IN UNDUE HARM TO THE 1
COMMON OWNERSHIP COMMUNITY; AND 2

(2) LIFTING THE STAY WILL NOT RESULT IN UNDUE HARM TO THE 3
RIGHTS OR INTERESTS OF ANY OPPOSING PARTY. 4

(D) IF A REQUEST FOR RELIEF FROM A STAY STATING FACTS SUFFICIENT TO 5
SHOW A NEED FOR IMMEDIATE ACTION IS NOT GRANTED OR DENIED WITHIN 20 DAYS 6
AFTER THE REQUEST WAS FILED, THE REQUEST SHALL BE DEEMED GRANTED. 7

11C–110. 8

(A) (1) FOLLOWING THE FILING OF A DISPUTE WITH A LOCAL 9
COMMISSION, AN AGENCY DESIGNATED BY A LOCAL GOVERNMEN T UNDER § 10
11C–107 OF THIS TITLE SUBTITLE MAY INVESTIGATE FACT S AND ASSEMBLE 11
DOCUMENTS RELEVANT T O THE DISPUTE AND MA Y PREPARE A SUMMARY OF THE 12
ISSUES IN THE DISPUTE FOR USE BY THE LOCAL COMMISSION. 13

(2) THE DESIGNATED AGENCY OR OFFICE MAY NOTIFY A PARTY IF 14
THE DESIGNATED AGENCY OR OFFICE FINDS THAT A DISPUTE WAS NOT PR OPERLY 15
FILED. 16

(3) THE DESIGNATED AGENCY OR OFFICE MAY NOTIFY EACH PARTY 17
OF THE DISPUTE REGAR DING POSSIBLE SANCTI ONS UNDER § 11C–112 OF THIS 18
TITLE SUBTITLE. 19

(B) IF THE DESIGNATED AGE NCY OR OFFICE FINDS THAT, ASSUMING ALL 20
FACTS ALLEGED BY THE PARTY THAT FILED THE DISPUTE ARE TRUE, THERE ARE NO 21
REASONABLE GROUNDS TO CONCLUDE THAT A VIOLATION OF APPLICABLE LAW OR 22
ANY GOVERNING DOCUMENT HAS OCCURRED, THE DESIGNATED AGENCY OR OFFICE 23
SHALL INFORM THE LOCAL COMMISSION. 24

(C) ON RECEIPT OF THE RESULTS OF AN INVESTIGATION BY A DESIGNATED 25
AGENCY OR OFFICE, A LOCAL COMMISSION MAY: 26

(1) IF IT FINDS THAT THER E ARE NO REASONABLE GROUNDS TO 27
CONCLUDE THAT A VIOLATION OF APPLICABLE LAW OR ANY GOVERNING DOCUMENT 28
HAS OCCURRED, DISMISS THE DISPUTE; 29

(2) REQUEST ADDITIONAL IN VESTIGATION BY THE D ESIGNATED 30
AGENCY OR OFFICE; OR 31

HOUSE BILL 402 17

(3) SCHEDULE A HEARING ON THE DISPUTE. 1

(D) A LOCAL COMMISSION MAY RECONSIDER THE DISMISSAL OF A DISPUTE 2
IF ANY PARTY FILES A MOTION TO RECONSIDER WITHIN 30 DAYS AFTER THE 3
DISPUTE IS DISMISSED, DEMONSTRATING THAT: 4

(1) THE LOCAL COMMISSION ERRONEOUSLY INTERPRE TED OR 5
APPLIED APPLICABLE LAW OR A GOVERNING DOCUMENT; OR 6

(2) MATERIAL ISSUES OF FA CT THAT ARE NECESSAR Y TO A FAIR 7
RESOLUTION OF THE DISPUTE REMAIN UNRESOLVED. 8

11C–111. 9

(A) (1) ANY PARTY IN A DISPUTE MAY REQUEST MEDIATION. 10

(2) IF A PARTY REQUESTS M EDIATION, THE LOCAL COMMISSION 11
SHALL NOTIFY ALL PARTIES OF THE REQUEST AND OF THE MEDIATION SESSION. 12

(3) A LOCAL COMMISSION SHA LL PROVIDE A QUALIFIED MEDIATOR 13
TO MEET WITH THE PARTIES WITHIN 30 DAYS AFTER A PARTY REQUESTS MEDIATION 14
TO ATTEMPT TO SETTLE THE DISPUTE. 15

(B) IF A PARTY REFUSES TO ATTEND A MEDIATION S ESSION, OR IF 16
MEDIATION DOES NOT S UCCESSFULLY RESOLVE THE DISPUTE WITHIN 10 DAYS 17
AFTER THE FIRST MEDIA TION SESSION IS HELD , THE LOCAL COMMISSION SHALL 18
PROMPTLY SCHEDULE A HEARING. 19

11C–112. 20

(A) (1) IF A HEARING IS SCHED ULED, THE CHAIR OF THE LOC AL 21
COMMISSION SHALL CONVENE A PANEL TO HEAR THE DISPUTE. 22

(2) THE CHAIR SHALL SELEC T AT L EAST ONE MEMBER DESC RIBED 23
UNDER § 11C–103(B)(1)(I)1 OF THIS TITLE SUBTITLE AND AT LEAST ONE MEM BER 24
DESCRIBED UNDER § 11C–103(B)(1)(I)2 OF THIS TITLE SUBTITLE. 25

(3) THE LOCAL COMMISSION MEMBERS SELECTED BY THE CHAIR 26
SHALL DESIGNATE A TH IRD MEMBER OF THE P ANEL FROM A LIST OF VOLUNTEER 27
ARBITRATORS TRAINED OR EXPERIENCED IN CO MMON OWNERSHIP COMMU NITY 28
ISSUES MAINTAINED BY THE LOCAL COMMISSION. 29

18 HOUSE BILL 402

(4) IF A SUITABLE ARBITRA TOR IS NOT AVAILABLE , THE CHAIR OF 1
THE LOCAL COMMISSION SHALL DESIGNATE: 2

(I) A THIRD PANELIST FROM AMONG THE VOTING MEMBERS OF 3
THE LOCAL COMMISSION; AND 4

(II) THE CHAIR OF THE PANEL. 5

(B) A PANELIST MAY NOT HAVE AN INTEREST IN THE DISPUTE TO BE HEARD. 6

(C) A HEARING PANEL SHALL HOLD A HEARING ON EACH DISPUTE THAT IS 7
NOT RESOLVED THROUGH MEDIATION UNDER § 11C–111 OF THIS TITLE SUBTITLE 8
UNLESS THE LOCAL COMMISSION DETERMINES THAT THE DISPUTE IS: 9

(1) IDENTICAL TO ANOTHER DISPUTE BETWEEN THE SAME PARTIES 10
ON WHICH A HEARING HAS ALREADY BEEN HELD UNDER THIS SECTION; OR 11

(2) CLEARLY NO T WITHIN THE JURISDI CTION OF THE LOCAL 12
COMMISSION. 13

(D) A LOCAL COMMISSION SHALL PROVIDE NOTICE OF A HEARING TO ALL 14
PARTIES NOT LESS THA N 30 DAYS BEFORE A HEARIN G, UNLESS THE LOCAL 15
COMMISSION DETERMINES THAT AN EXPEDITED HEARING IS NECESSARY, IN WHICH 16
CASE NOTICE SHALL BE PR OVIDED TO ALL PARTIE S AT LEAST 15 DAYS BEFORE A 17
HEARING. 18

(E) A PARTY OR WITNESS MAY BE ADVISED BY COUNSEL AT A HEARING. 19

(F) IF A PARTY , AFTER PROPER NOTICE , DOES NOT APPEAR AT T HE 20
SCHEDULED HEARING, THE HEARING PANEL MAY ORDER ANY RELIEF FOR ANOTHER 21
PARTY THAT THE FACTS ON RECORD WARRANT. 22

(G) (1) THE HEARING PANEL SHA LL APPLY STATE AND COUNTY LAWS 23
AND ALL RELEVANT CASE LAW TO THE FACTS OF THE DISPUTE. 24

(2) A DECISION OF THE HEARING PANEL IS BINDING ON THE PARTIES. 25

(H) (1) A LOCAL COMMISSION MAY ENFORCE A DECISION O F THE 26
HEARING PANEL BY APPROPRIATE LEGAL ACTION. 27

(2) IN ADDITION TO ANY OT HER ENFORCEMENT ACTI ON, A LOCAL 28
COMMISSION MAY: 29

HOUSE BILL 402 19

(I) FILE FOR INJUNCTIVE R ELIEF TO ENFORCE OR CORRECT 1
ANY VIOLATION OF THIS TITLE SUBTITLE; AND 2

(II) FILE TO RECOVER DAMAG ES FOR A LOSS SUSTAI NED AS A 3
RESULT OF A VIOLATION OF THIS TITLE SUBTITLE. 4

(I) A HEARING PANEL MAY AW ARD COSTS , INCLUDING REASONABLE 5
ATTORNEY’S FEES, TO ANY PARTY IF ANY OTHER PARTY: 6

(1) FILED OR MAINTAINED A FRIVOLOUS DISPUTE , OR FILED OR 7
MAINTAINED A DISPUTE IN BAD FAITH; 8

(2) REFUSED TO PARTICIPATE IN MEDIATION OF A DISPUTE; OR 9

(3) SUBSTANTIALLY DELAYED OR HINDERED THE DISP UTE 10
RESOLUTION PROCESS WITHOUT GOOD CAUSE. 11

(J) A HEARING PANEL MAY REQUIRE A LOSING PARTY IN A DISPUTE TO PAY 12
ALL OR PART OF ANY FILING FEE. 13

(K) A LOCAL GOVERNMENT MAY: 14

(1) ESTABLISH ADDITIONAL HEARING PROCEDURES; AND 15

(2) ADOPT ADDITIONAL REQU IREMENTS RELATING TO WITNESSES 16
AND EVIDENCE FOR A HEARING. 17

11C–113. 18

(A) A PARTY MAY APPEAL A DECISION OF A HEARING PANEL TO A COURT OF 19
COMPETENT JURISDICTION THE APPROPRIATE CIRCUIT COURT. 20

(B) AN APPEAL OF A DECISI ON SHALL MAY BE CONSOLIDATED WITH ANY 21
CASE THAT ARISES OUT OF THE SAME FACTS. 22

(C) THE COURT HEARING AN APPEAL SHALL SUSTAIN THE DECISION OF THE 23
HEARING PANEL UNLESS THE DECISION IS: 24

(1) INCONSISTENT WITH APPLICABLE LAW; 25

(2) LACKING SUBSTANTIAL EVIDENCE; OR 26

(3) ARBITRARY AND CAPRICIOUS. 27
20 HOUSE BILL 402

11C–114. 1

(A) A PARTY MAY FILE A CIV IL ACTION ARISING OU T OF A GOVER NING 2
DOCUMENT OR A LAW RE GULATING THE POWERS OF A GOVERNING BODY OF A 3
COMMON OWNERSHIP COMMUNITY. 4

(B) IF THE COURT IS NOTIF IED THAT A DISPUTE H AS BEEN FILED WITH A 5
LOCAL COMMISSION IN ACCORDANCE WITH THIS TITLE SUBTITLE, THE COURT MAY 6
POSTPONE A PROCEEDING FOR AT LEAST 90 DAYS. 7

(C) THE COURT MAY HEAR TH E ACTION DE NOVO IF A HEARING PANEL 8
ASSIGNED TO THE DISPUTE HAS NOT ISSUED A DECISION UNDER § 11C–112 OF THIS 9
TITLE SUBTITLE. 10

SUBTITLE 2. COMMON OWNERSHIP COMMUNITY OVERSIGHT DIVISION. 11

11C–201. 12

(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 13
INDICATED. 14

(B) “COMMON OWNERSHIP COMM UNITY” HAS THE MEANING STAT ED IN § 15
11C–101 OF THIS TITLE. 16

(C) “DEPARTMENT” MEANS THE DEPARTMENT OF HOUSING AND 17
COMMUNITY DEVELOPMENT. 18

(D) “DIVISION” MEANS THE COMMON OWNERSHIP COMMUNITY 19
OVERSIGHT DIVISION IN THE DEPARTMENT. 20

(E) “GOVERNING BODY OF A C OMMON OWNERSHIP COMMUNITY” HAS THE 21
MEANING STATED IN § 11C–101 OF THIS TITLE. 22

(F) “GOVERNING DOCUMENT ” MEANS AN OFFERING ST ATEMENT, A 23
DECLARATION, BYLAWS, RULES, REGULATIONS, A PROPRIETARY LEASE , OR ANY 24
OTHER SIMILAR DOCUMENT OF A COMMON OWNERSHIP COMMUNITY. 25

(G) “LOCAL COMMISSION” MEANS A COMMISSION ON COMMON OWNERSHIP 26
COMMUNITIES ESTABLISHED BY A COUNTY IN A CCORDANCE WITH § 11C–103 OF 27
THIS TITLE. 28

(H) “MEMBER” MEANS: 29

HOUSE BILL 402 21

(1) AN OCCUPANT OR A UNIT OWNER UNDER THE MARYLAND 1
CONDOMINIUM ACT; 2

(2) A LOT OWNER UNDER THE MARYLAND HOMEOWNERS 3
ASSOCIATION ACT; OR 4

(3) A MEMBER OF A COOPERAT IVE HOUSING CORPORAT ION AS 5
DEFINED IN § 5–6B–01 OF THE CORPORATIONS AND ASSOCIATIONS ARTICLE. 6

11C–202. 7

(A) THERE IS A COMMON OWNERSHIP COMMUNITY OVERSIGHT DIVISION 8
IN THE DEPARTMENT. 9

(B) THE DIVISION SHALL HAVE STAFF AS PROVIDED IN THE STATE BUDGET. 10

(C) THE DIVISION SHALL: 11

(1) IN ACCORDANCE WITH § 11C–204 OF THIS SUBTITLE: 12

(I) RECEIVE AND INVESTIGA TE COMPLAINTS BY MEM BERS 13
REGARDING FINAL ADVE RSE DECISIONS BY A G OVERNING BODY OF A C OMMON 14
OWNERSHIP COMMUNITY OR COMMON OWNERSHIP COMMUNITY MANAGER; AND 15

(II) CONDUCT HEARINGS ON A ND ISSUE BINDING DEC ISIONS 16
REGARDING COMPLAINTS DESCRIBED IN ITEM (I) OF THIS ITEM; 17

(2) IMPOSE FINES AND FEES AS AUTHORIZED UNDER THIS SUBTITLE; 18

(3) MAINTAIN A REGISTRY OF GOVERNING DOCUMENTS; AND 19

(4) PROVIDE COMPLIANCE GU IDANCE AND EDUCATION AL 20
MATERIALS. 21

(D) IN RESPONSE TO A COMPLAINT, THE DIVISION SHALL: 22

(1) REFER THE COMPLAINT TO AN APPROPRIATE LOCAL COMMISSION 23
FOR FURTHER REVIEW O F WHETHER THE FINAL ADVERSE DECISION CON FLICTS 24
WITH LAWS OR REGULAT IONS GOVERNING COMMON OWNERSHIP COMMUNITIES IN 25
THE JURISDICTION; OR 26

(2) IF THE COUNTY DOES NOT HAVE A LOCAL COMMISSION, RESOLVE 27
THE COMPLAINT USING THE PROCEDURES DESCR IBED IN § 11C–204 OF THIS 28
SUBTITLE. 29
22 HOUSE BILL 402

(E) (1) IF THE DIVISION DETERMINES THAT A FINAL ADVERSE DECISION 1
CONFLICTS WITH LAWS OR REGULATIONS GOVER NING COMMON OWNERSHI P 2
COMMUNITIES, THE DIVISION SHALL PROMPT LY NOTIFY THE MEMBER , THE 3
GOVERNING BOARD, AND, IF APPLICABLE, THE COMMON OWNERSHIP COMMUNITY 4
MANAGER THAT THE ADVERSE DECISION CONFLICTS WITH LAWS OR REGULATIONS 5
GOVERNING COMMON OWNERSHIP COMMUNITIES. 6

(2) IF WITHIN 1 YEAR AFTER ISSUING A DETERMINATION THE 7
DIVISION RECEIVES A S UBSEQUENT COMPLAINT OF A FINAL ADVERSE D ECISION 8
FOR THE SAME VIOLATI ON, THE DIVISION SHALL REFER THE MATTER TO THE 9
APPROPRIATE LOCAL COMMISSION, IF ANY. 10

(F) (1) ON OR BEFORE DECEMBER 1, 2028, AND EACH DECEMBER 1 11
THEREAFTER, THE DIVISION SHALL REPORT , IN ACCORDANCE WITH § 2–1257 OF 12
THE STATE GOVERNMENT ARTICLE, TO THE GENERAL ASSEMBLY ON THE 13
ACTIVITIES OF THE DIVISION DURING THE REPORTING PERIOD. 14

(2) THE REPORT REQUIRED U NDER PARAGRAPH (1) OF THIS 15
SUBSECTION SHALL INCLUDE: 16

(I) THE NUMBER OF COMPLAINTS RECEIVED BY THE DIVISION; 17

(II) THE TYPES OF ASSISTANCE REQUESTED; 18

(III) ACTIONS TAKEN BY THE DIVISION; 19

(IV) THE NUMBER OF REFERRA LS MADE TO LOCAL 20
COMMISSIONS; AND 21

(V) DATA ON DISPOSITIONS AND OUTCOMES OF COMP LAINTS 22
RECEIVED. 23

11C–203. 24

(A) (1) A COMMON OWNERSHIP COM MUNITY LOCATED IN TH E STATE 25
SHALL FILE WITH THE DIVISION A COPY OF THE GOVERNING DOCUMENTS, AND ANY 26
AMENDMENTS TO THE GO VERNING DOCUMENTS , OF THE COMMON OWNERS HIP 27
COMMUNITY. 28

(2) THE DIVISION SHALL DEVELO P AND MAINTAIN A DAT ABASE OF 29
GOVERNING DOCUMENTS FILED WITH THE DIVISION UNDER THIS S UBSECTION 30
ACCESSIBLE TO THE PUBLIC THROUGH THE DEPARTMENT’S WEBSITE. 31

HOUSE BILL 402 23

(B) UNLESS THE COUNTY HAS A LOCAL COMMISSION , A COMMON 1
OWNERSHIP COMMUNITY IN THE STATE SHALL REGISTER THE COMMON OWNERSHIP 2
COMMUNITY WITH THE DIVISION AND RENEW TH E REGISTRATION EACH 3
SUBSEQUENT YEAR. 4

(C) THE SECRETARY MAY ESTABLISH BY REGULATION: 5

(1) A COMPLAINT FILING FEE, NOT EXCEEDING $100; 6

(2) AN ANNUAL REGISTRATION FEE THAT IS BASED ON THE NUMBER 7
OF UNITS OR LOTS IN THE COMMUNITY; 8

(3) AN INITIAL GOVERNMEN T DOCUMENT FILING FE E, NOT 9
EXCEEDING $100; 10

(4) A FEE FOR AN AMENDME NT TO A GOVERNMENT D OCUMENT 11
PREVIOUSLY FILED, NOT EXCEEDING $25; AND 12

(5) A FINE FOR A FAILURE TO FILE GOVERNING DO CUMENTS AS 13
REQUIRED UNDER SUBSECTION (A) OF THIS SECTION, NOT EXCEEDING $500. 14

(D) FOR FIS CAL YEAR 2028, THE GOVERNOR SHALL INCLUD E IN THE 15
ANNUAL BUDGET BILL AN APPROPRIATION OF $50,004 TO THE DEPARTMENT TO BE 16
USED FOR THE DEVELOP MENT OF THE DATABASE REQUIRED UNDER SUBSE CTION 17
(A)(2) OF THIS SECTION. 18

11C–204. 19

(A) (1) THE DIVISION MAY HEAR ANY COMPLAINT FILED UNDE R § 20
11C–202 OF THIS SUBTITLE. 21

(2) A PARTY MAY NOT FILE A COMPLAINT WITH THE DIVISION UNTIL: 22

(I) THE PARTY HAS MADE A GOOD FAITH EFFORT TO EXHAUST 23
ALL PROCEDURES AND R EMEDIES PROVIDED BY THE GOVERNING DOCUMENTS OF 24
THE COMMON OWNERSHIP COMMUNITY; AND 25

(II) AT LEAST 60 DAYS AFTER ANY PROCEDURE OR REMEDY HAS 26
BEEN INITIATED WITH THE GOVERNING BODY O F A COMMON OWNERSHIP 27
COMMUNITY. 28

(3) (I) IF THE GOVERNING BODY OF A COMMON OWNERSHI P 29
COMMUNITY DETERMINES THAT A DISPUTE EXISTS, THE GOVERNING BODY OF THE 30
24 HOUSE BILL 402

COMMON OWNERSHIP COM MUNITY SHALL NOTIFY THE OTHER PARTIES OF THE 1
OPTION TO FILE THE DISPUTE WITH THE DIVISION. 2

(II) THE GOVERNING BODY OF A COMMON OWNERSHIP 3
COMMUNITY MAY NOT TAKE ACTION TO ENFORCE OR IMPLEMENT THE DECISION OF 4
THE GOVERNING BODY F OR 14 DAYS FOLLOWING NOTIF ICATION OF ALL OTHER 5
PARTIES. 6

(4) EXCEPT AS PROVIDED IN SUBSECTION (B) OF THIS SECTION , ON 7
THE FILING OF A COMP LAINT WITH THE DIVISION, THE DECISION OF THE 8
GOVERNING BODY OF A COMMON OWNERSHIP COMMUNITY SHALL BE STAYED AND 9
MAY NOT BE ENFORCED OR IMPLEMENTED, OTHER THAN BY FILING A CIVIL ACTION, 10
UNTIL THE COMPLETION OF THE COMPLAINT PROCESS. 11

(B) (1) AT ANY TIME AFTER A C OMPLAINT IS FILED , THE GOVERNING 12
BODY OF A COMMON OWNERSHIP COMMUNITY MAY SUBMIT A REQUEST TO LIFT AN 13
AUTOMATIC STAY UNDER SUBSECTION (A) OF THIS SECTION. 14

(2) IF A HEARING PANEL HA S NOT BEEN APPOINTED UNDER 15
SUBSECTION (E) OF THIS SECTION , THE DIVISION SHALL AUTHOR IZE A SPECIAL 16
STANDING PANEL TO CONSIDER REQUESTS FOR RELIEF FROM STAYS. 17

(3) THE SPECIAL PANEL SHALL INCLUDE: 18

(I) AT LEAST ONE MEMBER W HO IS AN OWNER IN A COMMON 19
OWNERSHIP COMMUNITY; AND 20

(II) AT LEAST ONE MEMBER WHO REPRESENTS PROFE SSIONS 21
ASSOCIATED WITH COMM ON OWNERSHIP COMMUNI TIES, INCLUDING INDIVIDUALS 22
INVOLVED IN HOUSING DEVELOPME NT OR REAL ESTATE SA LES, DEVELOPERS, OR 23
ATTORNEYS WHO REPRES ENT COMMON OWNERSHIP COMMUNITIES, OR IS A 24
LICENSED COMMON OWNERSHIP COMMUNITY MANAGER. 25

(4) (I) A GOVERNING BODY OF A COMMON OWNERSHIP 26
COMMUNITY THAT REQUE STS RELIEF FROM A ST AY SHALL SERVE A COP Y OF ITS 27
REQUEST ON ANY PARTY NAMED IN THE COMPLAI NT BY CERTIFIED MAIL OR 28
PERSONAL SERVICE. 29

(II) A CERTIFICATE OF SERVI CE SHALL ACCOMPANY A NY 30
REQUEST SUBMITTED UNDER THIS SUBSECTION. 31

(III) A PARTY SERVED WITH A COPY OF THE REQUEST SHALL 32
FILE ANY OPPOSITION TO THE REQUEST WITHI N 10 DAYS AFTER RECEIVING 33
SERVICE. 34
HOUSE BILL 402 25

(5) (I) EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS 1
PARAGRAPH, A REQUEST FOR RELIEF FROM A STAY MAY BE GRANTED ONLY IF THE 2
ASSIGNED PANEL FINDS THAT: 3

1. ENFORCING THE STAY WO ULD RESULT IN UNDUE 4
HARM TO THE COMMON OWNERSHIP COMMUNITY; AND 5

2. LIFTING THE STAY WILL NOT RESULT IN UNDUE HARM 6
TO THE RIGHTS OR INTERESTS OF ANY OPPOSING PARTY. 7

(II) IF A REQUEST FOR RELI EF FROM A STAY STATI NG FACTS 8
SUFFICIENT TO SHOW A NEED FOR IMMEDIATE ACTION IS NOT GRANTED OR DENIED 9
WITHIN 20 DAYS AFTER THE REQUEST WAS FILED, THE REQUEST SHALL BE DEEMED 10
GRANTED. 11

(C) (1) FOLLOWING THE FILING OF A COMPLAINT, THE DIVISION SHALL 12
INVESTIGATE FACTS AND ASSEMBLE DOCUMENTS RELEVANT TO THE COMPLAINT. 13

(2) THE DIVISION MAY NOTIFY A PARTY IF THE DESIGNATED AGENCY 14
OR OFFICE FINDS THAT A COMPLAINT WAS NOT PROPERLY FILED. 15

(3) THE DIVISION MAY NOTIFY E ACH PARTY OF THE COM PLAINT 16
REGARDING POSSIBLE SANCTIONS UNDER SUBSECTION (E) OF THIS SECTION. 17

(4) AFTER AN INVESTIGATIO N UNDER THIS SECTION THE DIVISION 18
MAY: 19

(I) IF IT FINDS THAT THERE ARE NO REASONABLE GROUNDS TO 20
CONCLUDE THAT A VIOLATION OF APPLICABLE LAW OR ANY GOVERNING DOCUMENT 21
HAS OCCURRED, DISMISS THE COMPLAINT; 22

(II) REQUEST ADDITIONAL INVESTIGATION; OR 23

(III) SCHEDULE A HEARING ON THE COMPLAINT. 24

(5) THE DIVISION MAY RECONSID ER THE DISMISSAL OF A 25
COMPLAINT IF ANY PARTY FILES A MOTION TO RECONSIDER WITHIN 30 DAYS AFTER 26
THE COMPLAINT IS DISMISSED, DEMONSTRATING THAT: 27

(I) THE DIVISION ERRONEOUSLY INTERPRETED OR APPLI ED 28
APPLICABLE LAW OR A GOVERNING DOCUMENT; OR 29

26 HOUSE BILL 402

(II) MATERIAL ISSUES OF FACT THAT ARE NECESSARY TO A FAIR 1
RESOLUTION OF THE COMPLAINT REMAIN UNRESOLVED. 2

(D) (1) ANY PARTY IN A COMPLAINT MAY REQUEST MEDIATION. 3

(2) IF A PARTY REQUESTS M EDIATION, THE DIVISION SHALL NOTIFY 4
ALL PARTIES OF THE REQUEST AND OF THE MEDIATION SESSION. 5

(3) THE DIVISION SHALL PROVIDE A QUALIFIED MEDIATOR TO MEET 6
WITH THE PARTIES WIT HIN 30 DAYS AFTER A PARTY R EQUESTS MEDIATION TO 7
ATTEMPT TO SETTLE THE COMPLAINT. 8

(4) IF A PARTY REFUSES TO ATTEND A MEDIATION S ESSION, OR IF 9
MEDIATION DOES NOT S UCCESSFULLY RESOLVE THE COMPLAINT WITHIN 10 DAYS 10
AFTER THE FIRST MEDI ATION SESSION IS HEL D, THE DIVISION SHALL PROMPT LY 11
SCHEDULE A HEARING. 12

(E) (1) (I) IF A HEARING IS SCHED ULED, THE SECRETARY SHALL 13
CONVENE A PANEL TO HEAR THE COMPLAINT. 14

(II) THE SECRETARY SHALL SELEC T AT LEAST ONE MEMBER 15
DESCRIBED UNDER SUBS ECTION (B)(3)(I) OF THIS SECTION AND AT LEAST ONE 16
MEMBER DESCRIBED UNDER SUBSECTION (B)(3)(II) OF THIS SECTION. 17

(III) THE MEMBERS SELECTED BY THE SECRETARY SHALL 18
DESIGNATE A THIRD ME MBER OF THE PANEL FR OM A LIST OF VOLUNTEER 19
ARBITRATORS TRAINED OR EXPERIENCED IN CO MMON OWNERSHIP COMMU NITY 20
ISSUES MAINTAINED BY THE DIVISION. 21

(2) A PANELIST MAY NOT HAVE AN INTEREST IN THE COMPLAINT TO 22
BE HEARD. 23

(3) A HEARING PANEL SHALL HOLD A HEARING ON EACH COMPLAINT 24
THAT IS NO T RESOLVED THROUGH M EDIATION UNDER SUBSE CTION (D) OF THIS 25
SECTION UNLESS THE DIVISION DETERMINES THAT THE COMPLAINT IS: 26

(I) IDENTICAL TO ANOTHER COMPLAINT BETWEEN TH E SAME 27
PARTIES ON WHICH A HEARING HAS ALREADY BEEN HELD UNDER THIS SECTION; OR 28

(II) CLEARLY NOT WITHIN TH E JURISDICTION OF TH E 29
DIVISION. 30

(4) THE DIVISION SHALL PROVID E NOTICE OF A HEARIN G TO ALL 31
PARTIES NOT LESS THA N 30 DAYS BEFORE THE HEAR ING, UNLESS THE DIVISION 32
HOUSE BILL 402 27

DETERMINES THAT AN EXPEDITED HEARING IS NECESSARY, IN WHICH CASE NOTICE 1
SHALL BE PROVIDED TO ALL PARTIES AT LEAST 15 DAYS BEFORE THE HEARING. 2

(5) A PARTY OR WITNESS MAY BE ADVISED BY COUNSE L AT A 3
HEARING. 4

(6) IF A PARTY , AFTER PROPER NOTICE , DOES NOT APPEAR AT A 5
SCHEDULED HEARING, THE HEARING PANEL MAY ORDER ANY RELIEF FOR ANOTHER 6
PARTY THAT THE FACTS ON RECORD WARRANT. 7

(7) (I) THE HEARING PANEL SHA LL APPLY STATE AND COUNTY 8
LAWS AND ALL RELEVANT CASE LAW TO THE FACTS OF THE COMPLAINT. 9

(II) A DECISION OF THE HEAR ING PANEL IS BINDING ON THE 10
PARTIES. 11

(8) (I) THE DIVISION MAY ENFORCE A DECISION OF THE HEARING 12
PANEL BY APPROPRIATE LEGAL ACTION. 13

(II) IN ADDITION TO ANY OT HER ENFORCEMENT ACTI ON, THE 14
DIVISION MAY: 15

1. FILE FOR INJUNCTIVE R ELIEF TO ENFORCE OR 16
CORRECT ANY VIOLATION OF THIS SUBTITLE; AND 17

2. FILE TO RECOVER DAMAGES FOR A LOSS SUSTAI NED 18
AS A RESULT OF A VIOLATION OF THIS SUBTITLE. 19

(9) A HEARING PANEL MAY AWARD COSTS, INCLUDING REASONABLE 20
ATTORNEY’S FEES, TO ANY PARTY IF ANY OTHER PARTY: 21

(I) FILED OR MAINTAINED A FRIVOLOUS COMPLAINT, OR FILED 22
OR MAINTAINED A COMPLAINT IN BAD FAITH; 23

(II) REFUSED TO PARTICIPATE IN MEDIATION OF A COMPLAINT; 24
OR 25

(III) SUBSTANTIALLY DELAYED OR HINDERED THE COMP LAINT 26
RESOLUTION PROCESS WITHOUT GOOD CAUSE. 27

(10) A HEARING PANEL MAY RE QUIRE A LOSING PARTY IN A 28
COMPLAINT TO PAY ALL OR PART OF ANY FILING FEE. 29

(11) THE DIVISION MAY: 30
28 HOUSE BILL 402

(I) ESTABLISH ADDITIONAL HEARING PROCEDURES; AND 1

(II) ADOPT ADDITIONAL REQU IREMENTS RELATING TO 2
WITNESSES AND EVIDENCE FOR A HEARING. 3

(F) (1) A PARTY MAY APPEAL A DECISION OF A HEARIN G PANEL TO A 4
COURT OF COMPETENT JURISDICTION. 5

(2) AN APPEAL OF A DECISI ON SHALL BE CONSOLID ATED WITH ANY 6
CASE THAT ARISES OUT OF THE SAME FACTS. 7

(3) THE COURT HEARING AN APPEAL SHALL SUSTAIN THE DECISION 8
OF THE HEARING PANEL UNLESS THE DECISION IS: 9

(I) INCONSISTENT WITH APPLICABLE LAW; 10

(II) LACKING SUBSTANTIAL EVIDENCE; OR 11

(III) ARBITRARY AND CAPRICIOUS. 12

(G) (1) A PARTY MAY FILE A CIVIL ACTION ARISING OUT OF A GOVERNING 13
DOCUMENT OR A LAW RE GULATING THE POWERS OF A GOVERNING BODY OF A 14
COMMON OWNERSHIP COMMUNITY. 15

(2) IF THE COURT IS NOTIF IED THAT A COMPLAINT HAS BEEN FILED 16
WITH THE DIVISION IN ACCORDANC E WITH TH IS SUBTITLE , THE COURT MAY 17
POSTPONE A PROCEEDING FOR AT LEAST 90 DAYS. 18

(3) THE COURT MAY HEAR THE ACTION DE NOVO IF A HEARING PANEL 19
ASSIGNED TO THE COMPLAINT HAS NOT ISSUED A DECISION UNDER SUBSECTION (E) 20
OF THIS SECTION. 21

11C–205. 22

(A) (1) THE CREATION OF THE DIVISION DOES NOT OVERRIDE, PREEMPT, 23
OR DIMINISH THE AUTH ORITY OF ANY EXISTIN G COMMISSION ON COMM ON 24
OWNERSHIP COMMUNITIES ESTABLISHED BY A COUNTY OR LOCAL MUNICIPALITY. 25

(2) A COUNTY OR LOCAL MUNI CIPALITY MAY ESTABLISH, MAINTAIN, 26
OR EXPAND ITS OWN COMMISSION OR OVERSIGHT BODY CO NSISTENT WITH LOCAL 27
LAW AND SUBTITLE 1 OF THIS TITLE. 28

HOUSE BILL 402 29

(B) THIS SUBTITLE MAY NOT BE CONSTRUED TO PROH IBIT A LOCAL 1
JURISDICTION FROM AD OPTING SUPPLEMENTAL GOVERNANCE STRUCTURE S OR 2
DISPUTE RESOLUTION PROGRAMS FOR COMMON OWNERSHIP COMMUNITIES. 3

11C–206. 4

(A) IN THIS SECTION , “FUND” MEANS THE COMMON OWNERSHIP 5
COMMUNITY OVERSIGHT FUND. 6

(B) THERE IS A COMMON OWNERSHIP COMMUNITY OVERSIGHT FUND. 7

(C) THE PURPOSE OF THE FUND IS TO PROVIDE FUNDING TO THE COMMON 8
OWNERSHIP COMMUNITY OVERSIGHT DIVISION IN THE DEPARTMENT OF HOUSING 9
AND COMMUNITY DEVELOPMENT. 10

(D) THE SECRETARY SHALL ADMINISTER THE FUND. 11

(E) (1) THE FUND IS A SPECIAL , NONLAPSING FUND THAT IS NOT 12
SUBJECT TO § 7–302 OF THE STATE FINANCE AND PROCUREMENT ARTICLE. 13

(2) THE STATE TREASURER SHALL HOLD THE FUND SEPARATELY , 14
AND THE COMPTROLLER SHALL ACCOUNT FOR THE FUND. 15

(F) THE FUND CONSISTS OF: 16

(1) THE FOLLOWING FEES C OLLECTED UNDER § 11C–203 OF THIS 17
SUBTITLE: 18

(I) COMPLAINT FILING FEES; 19

(II) ANNUAL COMMON OWNERSHIP REGISTRATION FEES; AND 20

(III) GOVERNMENT DOCUMENT FILING FEES; 21

(2) FINES ASSESSED UNDER THIS SUBTITLE; 22

(3) INTEREST EARNINGS OF THE FUND; AND 23

(4) ANY OTHER MONEY FROM ANY OTHER SOURCE ACC EPTED FOR 24
THE BENEFIT OF THE FUND. 25

(G) (1) THE STATE TREASURER SHALL INVEST THE MONEY OF THE FUND 26
IN THE SAME MANNER AS OTHER STATE MONEY MAY BE INVESTED. 27

30 HOUSE BILL 402

(2) ANY INTEREST EARNINGS OF THE FUND SHALL BE CREDITED TO 1
THE FUND. 2

Article – State Finance and Procurement 3

6–226. 4

(a) (1) Except as otherwise specifically provided by law or by regulation of the 5
Treasurer, the Treasurer shall credit to the General Fund any interest on or other income 6
from State money that the Treasurer invests. 7

(2) (i) This paragraph does not apply in fiscal years 2024 through 2028. 8

(ii) Notwithstanding any other provision of law, and unless 9
inconsistent with a federal law, grant agreement, or other federal requirement or with the 10
terms of a gift or settlement agreement, net interest on all State money allocat ed by the 11
State Treasurer under this section to special funds or accounts, and otherwise entitled to 12
receive interest earnings, as accounted for by the Comptroller, shall accrue to the General 13
Fund of the State. 14

(iii) The provisions of subparagraph (ii ) of this paragraph do not 15
apply to the following funds: 16

212. the Department of Social and Economic Mobility Special 17
Fund; [and] 18

213. the Population Health Improvement Fund; AND 19

214. THE COMMON OWNERSHIP COMMUNITY OVERSIGHT 20
FUND. 21

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 22
October 1, 2026. 23

Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.