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- 83rd Session (2025)
Senate Bill No. 121–Senator Neal
CHAPTER..........
AN ACT relating to common -interest communities; prohibiting a
unit-owners’ association for a common -interest community
from requiring landscaping under certain circumstances;
revising provisions governing the collection of past due
obligations by a unit-owners’ association; revising provisions
governing damages to real property in a unit -owners’
association; prohibiting a unit -owners’ association from
restricting the parking of certain vehicles; requiring certain
notice of termination or assignment of an agreement for the
management of a common -interest community under certain
circumstances; and providing other matters properly relating
thereto.
Legislative Counsel’s Digest:
Existing law requires a unit -owners’ association for a common -interest
community to adopt bylaws and authorizes an association to a mend the bylaws and
adopt rules and regulations concerning the community. (NRS 116.3102) Section 1
of this bill prohibits the executive board and governing documents of an association
from requiring a unit’s owner to install landscaping in the back yard of his or her
unit sooner than 24 months after the close of escrow for the initial purchase of the
unit from a declarant. Section 1 further authorizes the executive board and
governing documents of an association to require a unit’s owner to install a thin
layer of rock in the back yard of his or her unit not sooner than 12 months after the
close of escrow for the initial purchase of the unit from a declarant.
Existing law authorizes a unit-owners’ association to charge reasonable fees for
costs associated with collecting any past due obligation. (NRS 116.310313) Section
2 of this bill prohibits an association from: (1) charging any late fee sooner than 30
days after an obligation becomes past due; and (2) reporting any past due obligation
to a reporting agency that assembles or evaluates information concerning credit.
Existing law authorizes a unit -owners’ association to assess a unit’s owner for
certain damage s or common expenses. (NRS 116.3115) Section 3 of this bill
prohibits an association from assessing a unit’s owner for an oil stain that is located
entirely on the driveway of the unit’s owner.
Existing law authorizes the governing documents of a unit -owners’ association
to set forth rules that reasonably restrict parking in the common-interest community
and authorizes an association to impose fines for a violation of the governing
documents. Existing law also prohibits an association from restricting the parking
of certain utility service vehicles, law enforcement vehicles and emergency services
vehicles under certain circumstances. (NRS 116.31031, 116.350) Section 4 of this
bill prohibits an association from restricting the parking of certain vehicles
displaying a commercial advertisement, other than vehicles displaying a
commercial advertisement containing a sexual portrayal or depicting an image
relating to the sale of a controlled substance. An association may require such
images to be obscured by a magnet.
Existing law imposes certain requirements relating to agreements for the
management of a common -interest community and requires the Commission for
Common-Interest Communities and Condominium Hotels to adopt regulations
regarding the transfer of all b ooks, records and other papers of a client upon the
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termination or assignment of such an agreement. (NRS 116A.620) Section 5 of this
bill requires, with certain exceptions, the association to provide notice of the
termination of an agreement to be posted w ithin the common elements of an
association and provided by electronic mail to all units’ owners who have provided
the association with an electronic mail address.
EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Chapter 116 of NRS is hereby amended by adding
thereto a new section to read as follows:
1. Except as otherwise provided in subsection 2, the executive
board of an association and the governing documents of that
association may not require a unit’s owner to install landscaping
in the back yard of his or her unit sooner than 24 months after the
close of escrow for the initial purchase of the unit from a
declarant.
2. The executive board of an association and the governing
documents of that association may require a unit’s owner to install
a thin layer of rock in the back yard of his or her unit not sooner
than 12 months after the close of escrow for the initial purchase of
the unit from a declarant.
Sec. 2. NRS 116.310313 is hereby am ended to read as
follows:
116.310313 1. [An] Except as otherwise provided in
subsection 2, an association may charge a unit’s owner reasonable
fees to cover the costs of collecting any past due obligation. The
Commission shall adopt regulations establis hing the amount of the
fees that an association may charge pursuant to this section.
2. An association may not:
(a) Charge a unit’s owner a late fee sooner than 30 days after
any obligation becomes past due.
(b) Report any past due obligation to a reporting agency that
assembles or evaluates information concerning credit.
3. The provisions of this section apply to any costs of
collecting a past due obligation charged to a unit’s owner, regardless
of whether the past due obligation is collected by the association
itself or by any person acting on behalf of the association, including,
without limitation, an officer or employee of the association, a
community manager or a collection agency.
[3.] 4. As used in this section:
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(a) “Costs of collecting” includes any fee, charge or cost, by
whatever name, including, without limitation, any collection fee,
filing fee, recording fee, fee related to the preparation, recording or
delivery of a lien or lien rescission, title search lien fee, bankruptcy
search fee, referral fee, fee for postage or delivery and any other fee
or cost that an association charges a unit’s owner for the
investigation, enforcement or collection of a past due obligation.
The term does not include any costs incurred by an association if a
lawsuit is filed to enforce any past due obligation or any costs
awarded by a court.
(b) “Obligation” means any assessment, fine, construction
penalty, fee, charge or interest levied or imposed against a unit’s
owner pursuant to any provision of this c hapter or the governing
documents.
Sec. 3. NRS 116.3115 is hereby amended to read as follows:
116.3115 1. Until the association makes an assessment for
common expenses, the declarant shall pay all common expenses.
After an assessment has been made by the association, assessments
must be made at least annually, based on a budget adopted at least
annually by the association in accordance with the requirements set
forth in NRS 116.31151. Unless the declaration imposes more
stringent standards, the budget must include a budget for the daily
operation of the association and a budget for the reserves required
by paragraph (b) of subsection 2.
2. Except for assessments under subsections 4 to 7, inclusive,
or as otherwise provided in this chapter:
(a) All common expenses, including the reserves, must be
assessed against all the units in accordance with the allocations set
forth in the declaration pursuant to subsections 1 and 2 of
NRS 116.2107.
(b) The association shall establish adequate reserves, funded on
a reasonable basis, for the repair, replacement and restoration of the
major components of the common elements and any other portion of
the common-interest community that the association is obligated to
maintain, repair, replace or restore. The reserves may be used only
for those purposes, including, without limitation, repairing,
replacing and restoring roofs, roads and sidewalks, and must not be
used for daily maintenance. The association may comply with the
provisions of this paragraph through a funding plan that is designed
to allocate the costs for the repair, replacement and restoration of the
major components of the common elements and any other portion of
the common-interest community that the association is obl igated to
maintain, repair, replace or restore over a period of years if the
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funding plan is designed in an actuarially sound manner which will
ensure that sufficient money is available when the repair,
replacement and restoration of the major components o f the
common elements or any other portion of the common -interest
community that the association is obligated to maintain, repair,
replace or restore are necessary. Notwithstanding any provision of
the governing documents to the contrary, to establish adeq uate
reserves pursuant to this paragraph, including, without limitation, to
establish or carry out a funding plan, the executive board may,
without seeking or obtaining the approval of the units’ owners,
impose any necessary and reasonable assessments agai nst the units
in the common-interest community. Any such assessments imposed
by the executive board must be based on the study of the reserves of
the association conducted pursuant to NRS 116.31152.
3. Any assessment for common expenses or installment thereof
that is 60 days or more past due bears interest at a rate equal to the
prime rate at the largest bank in Nevada as ascertained by the
Commissioner of Financial Institutions on January 1 or July 1, as
the case may be, immediately preceding the date th e assessment
becomes past due, plus 2 percent. The rate must be adjusted
accordingly on each January 1 and July 1 thereafter until the balance
is satisfied.
4. Except as otherwise provided in the governing documents:
(a) Any common expense associated wi th the maintenance,
repair, restoration or replacement of a limited common element
must be assessed against the units to which that limited common
element is assigned, equally, or in any other proportion the
declaration provides;
(b) Any common expense be nefiting fewer than all of the units
or their owners, including, without limitation, common expenses
consisting of the payment, on behalf of a unit’s owner, of delinquent
property taxes or utility charges owed by the unit’s owner, may be
assessed exclusive ly against the units or units’ owners benefited;
and
(c) The costs of insurance must be assessed in proportion to risk
and the costs of utilities must be assessed in proportion to usage.
5. Assessments to pay a judgment against the association may
be made only against the units in the common-interest community at
the time the judgment was entered, in proportion to their liabilities
for common expenses.
6. If damage to a unit or other part of the common -interest
community, or if any other common expense is caused by the willful
misconduct or gross negligence of any unit’s owner, tenant or
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invitee of a unit’s owner or tenant, the association may assess that
expense exclusively against his or her unit, even if the association
maintains insurance with respe ct to that damage or common
expense, unless the damage or other common expense is caused by a
vehicle and is [committed] :
(a) Committed by a person who is delivering goods to, or
performing services for, the unit’s owner, tenant or invitee of the
unit’s owner or tenant [.] ; or
(b) An oil stain that is located entirely on the driveway of the
unit’s owner.
7. The association of a common -interest community created
before January 1, 1992, is not required to make an assessment
against a vacant lot located within the community that is owned by
the declarant.
8. If liabilities for common expenses are reallocated,
assessments for common expenses and any installment thereof not
yet due must be recalculated in accordance with the reallocated
liabilities.
9. The association shall provide written notice to each unit’s
owner of a meeting at which an assessment for a capital
improvement is to be considered or action is to be taken on such an
assessment at least 21 calendar days before the date of the meeting.
Sec. 4. NRS 116.350 is hereby amended to read as follows:
116.350 1. In a common -interest community which is not
gated or enclosed and the access to which is not restricted or
controlled by a person or device, the executi ve board shall not and
the governing documents must not provide for the regulation of any
road, street, alley or other thoroughfare the right -of-way of which is
accepted by the State or a local government for dedication as a road,
street, alley or other thoroughfare for public use.
2. Except as otherwise provided in subsection 3, the provisions
of subsection 1 do not preclude an association from adopting, and
do not preclude the governing documents of an association from
setting forth, rules that reasonab ly restrict the parking or storage of
recreational vehicles, watercraft, trailers or commercial vehicles in
the common -interest community to the extent authorized by law.
The governing documents of an association may authorize the
executive board of the as sociation to impose a fine pursuant to
NRS 116.31031 for any violation of the rules authorized pursuant to
this subsection.
3. In any common -interest community, the executive board
shall not and the governing documents must not prohibit a person
from:
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(a) Parking a utility service vehicle that has a gross vehicle
weight rating of 20,000 pounds or less:
(1) In an area designated for parking for visitors, in a
designated parking area or common parking area, or on the
driveway of the unit of a subscriber or consumer, while the person is
engaged in any activity relating to the delivery of public utility
services to subscribers or consumers; or
(2) In an area designated for parking for visitors, in a
designated parking area or common parking area, or on t he
driveway of his or her unit, if the person is:
(I) A unit’s owner or a tenant of a unit’s owner; and
(II) Bringing the vehicle to his or her unit pursuant to his
or her employment with the entity which owns the vehicle for the
purpose of respondin g to emergency requests for public utility
services; [or]
(b) Parking a law enforcement vehicle or emergency services
vehicle:
(1) In an area designated for parking for visitors, in a
designated parking area or common parking area, or on the
driveway of the unit of a person to whom law enforcement or
emergency services are being provided, while the person is engaged
in his or her official duties; or
(2) In an area designated for parking for visitors, in a
designated parking area or common parking area, or on the
driveway of his or her unit, if the person is:
(I) A unit’s owner or a tenant of a unit’s owner; and
(II) Bringing the vehicle to his or her unit pursuant to his
or her employment with the entity which owns the vehicle for the
purpose of r esponding to requests for law enforcement services or
emergency services [.] ; or
(c) Except as otherwise provided in this paragraph, parking a
vehicle having a gross vehicle weight of less than 10,000 pounds
that contains a commercial advertisement in an area designated
for parking for visitors, in a designated parking area or common
parking area or on the driveway of his or her unit. An association
may not require the owner of such a vehicle to cover any
commercial advertisement, other than an advertisem ent
containing a sexual portrayal or an image relating to the sale of a
controlled substance. An association may require the owner to use
a magnet to obscure any commercial advertisement containing
such images.
4. An association may require that a person parking a utility
service vehicle, law enforcement vehicle or emergency services
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vehicle as set forth in paragraph (a) or (b) of subsection 3 provide
written confirmation from his or her employer that the person is
qualified to park his or her vehicle in the manner set forth in
subsection 3.
5. As used in this section:
(a) “Emergency services vehicle” means a vehicle:
(1) Owned by any governmental agency or political
subdivision of this State; and
(2) Identified by the entity which owns the vehicle as a
vehicle used to provide emergency services.
(b) “Law enforcement vehicle” means a vehicle:
(1) Owned by any governmental agency or political
subdivision of this State; and
(2) Identified by the entity which owns the vehicle as a
vehicle used to provide law enforcement services.
(c) “Sexual portrayal” has the meaning ascribed to it in
NRS 200.700.
(d) “Utility service vehicle” means any motor vehicle:
(1) Used in the furtherance of repairing, maintaining or
operating any structure or any other physical facility necessary for
the delivery of public utility services, including, without limitation,
the furnishing of electricity, gas, water, sanitary sewer, telephone,
cable or community antenna service; and
(2) Except for any emergency use, opera ted primarily within
the service area of a utility’s subscribers or consumers, without
regard to whether the motor vehicle is owned, leased or rented by
the utility.
Sec. 5. NRS 116A.620 is hereby amended to read as follows:
116A.620 1. Any management agreement must:
(a) Be in writing and signed by all parties;
(b) Be entered into between the client and the community
manager or the employer of the community manager if the
community manager is acting on behalf of a corporation,
partnership, limited partnership, limited -liability partnership,
limited-liability company or other entity;
(c) State the term of the management agreement;
(d) State the basic consideration for the services to be provided
and the payment schedule;
(e) Include a complete schedule of all fees, costs, expenses and
charges to be imposed by the community manager, whether direct or
indirect, including, without limitation:
(1) The costs for any new client or start-up costs;
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(2) The fees for s pecial or nonroutine services, such as the
mailing of collection letters, the recording of liens and foreclosing
of property;
(3) Reimbursable expenses;
(4) The fees for the sale or resale of a unit or for setting up
the account of a new member; and
(5) The portion of fees that are to be retained by the client
and the portion to be retained by the community manager;
(f) State the identity and the legal status of the contracting
parties;
(g) State any limitations on the liability of each contracting
party;
(h) Include a statement of the scope of work of the community
manager;
(i) State the spending limits of the community manager;
(j) Include provisions relating to the grounds and procedures for
termination of the community manager;
(k) Identify the types and amounts of insurance coverage to be
carried by each contracting party, including, without limitation:
(1) A requirement that the community manager or his or her
employer shall maintain insurance covering liability for errors or
omissions, professional liability or a surety bond to compensate for
losses actionable pursuant to this chapter in an amount of
$1,000,000 or more;
(2) An indication of which contracting party will maintain
fidelity bond coverage; and
(3) A statement as to whether the client will maintain
directors and officers liability coverage for the executive board;
(l) Include provisions for dispute resolution;
(m) Acknowledge that all records and books of the client are the
property of the client, except any proprietary inf ormation and
software belonging to the community manager;
(n) State the physical location, including the street address, of
the records of the client, which must be within 60 miles from the
physical location of the common-interest community;
(o) State the frequency and extent of regular inspections of the
common-interest community; and
(p) State the extent, if any, of the authority of the community
manager to sign checks on behalf of the client in an operating
account.
2. In addition to any other requi rements under this section, a
management agreement may:
(a) Provide for mandatory binding arbitration; or
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(b) Allow the provisions of the management agreement to apply
month to month following the end of the term of the management
agreement, but the management agreement may not contain an
automatic renewal provision.
3. Not later than 10 days after the effective date of a
management agreement, the community manager shall provide each
member of the executive board evidence of the existence of the
required insurance, including, without limitation:
(a) The names and addresses of all insurance companies;
(b) The total amount of coverage; and
(c) The amount of any deductible.
4. After signing a management agreement, the community
manager shall provide a copy of the management agreement to each
member of the executive board. Within 30 days after an election or
appointment of a new member to the executive board, the
community manager shall provide the new member with a copy of
the management agreement.
5. Any changes to a management agreement must be initialed
by the contracting parties. If there are any changes after the
execution of a management agreement, those changes must be in
writing and signed by the contracting parties.
6. Except as otherwise provided in subsection 8, not less than
40 days before any termination or assignment of a management
agreement, the secretary or other officer specified in the bylaws of
the association shall:
(a) In a common -interest community with 100 units or more,
post notice of the pending termination or assignment in one or
more prominent places within the common elements of the
association; and
(b) Provide electronic notice of the pending termination or
assignment to all units’ owners who have provided the assoc iation
with an electronic mail address.
7. Until the regulations adopted by the Commission pursuant to
subsection [8] 9 become effective, and except as otherwise provided
in the management agreement, upon the termination or assignment
of a management agr eement, the community manager shall, within
30 days after the termination or assignment, transfer possession of
all books, records and other papers of the client to the succeeding
community manager, or to the client if there is no succeeding
community mana ger, regardless of any unpaid fees or charges to
the community manager or management company.
[7.] 8. Notwithstanding any provision in a management
agreement to the contrary, a management agreement may be
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terminated by the client without penalty upon 30 days’ notice
following a violation by the community manager of any provision of
this chapter or chapter 116 of NRS. Upon termination of the
agreement, the secretary or other officer specified in the bylaws of
the association shall:
(a) In a common -interest community with 100 or more units,
post notice of the termination in one or more prominent places
within the common elements of the association; and
(b) Provide electronic notice of the termination to all units’
owners who have provided the association with an electronic mail
address.
[8.] 9. The Commission shall adopt regulations establishing
the requirements relating to the transfer of all books, records and
other papers of the client upon the termination or assignment of a
management agreement.
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