Relating to planned unit development; creating new provisions; and amending ORS 94.550, 94.570, 94.572, 94.590, 94.595, 94.604, 94.625, 94.630, 94.640, 94.647, 94.660, 94.670, 94.704, 94.709, 94.775, 100.105, 100.115, 100.130, 100.135, 100.175, 100.405, 100.407, 100.410, 100.417, 100.420, 100.425, 100.427, 100.450, 100.475, 100.480 and 100.625.

 
 
 
     72nd OREGON LEGISLATIVE ASSEMBLY--2003 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 1570
 
                         House Bill 3385
 
Sponsored by COMMITTEE ON JUDICIARY (at the request of
  Condominium Working Group)
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
 
  Modifies provisions regulating planned unit developments.
 
                        A BILL FOR AN ACT
Relating to planned unit development; creating new provisions;
  and amending ORS 94.550, 94.570, 94.572, 94.590, 94.595,
  94.604, 94.625, 94.630, 94.640, 94.647, 94.660, 94.670, 94.704,
  94.709, 94.775, 100.105, 100.115, 100.130, 100.135, 100.175,
  100.405, 100.407, 100.410, 100.417, 100.420, 100.425, 100.427,
  100.450, 100.475, 100.480 and 100.625.
Be It Enacted by the People of the State of Oregon:
  SECTION 1.  { + Section 2 of this 2003 Act is added to and made
a part of ORS 94.550 to 94.783. + }
  SECTION 2.  { + (1) Upon compliance with subsection (2) of this
section, an association may record in the deed records of the
county in which the planned community is located a notice of
violation of the declaration, bylaws or other governing document
recorded in the deed records of the county in which the property
is located, including amendments or supplements to governing
documents and rules or regulations adopted pursuant governing
documents. The notice must be in the form prescribed in this
section.
  (2) Unless the declaration, bylaws or other recorded governing
document provides otherwise, a notice of violation may not be
recorded unless:
  (a) The violation involves a condition or restriction of a
governing document that affects an owner's lot or improvement to
the lot;
  (b) The owner has been given written notice of the alleged
violation in accordance with the governing documents and the
notice includes a statement of the owner's right to request a
hearing, the right of the association to record a notice of
violation and the other specific requirements of this subsection;
  (c) The owner has been given an opportunity to have a hearing
before the board of directors or other entity responsible for
enforcement under the governing documents;
  (d) A hearing, if requested, has been held, a final
determination of violation in writing has been made and any
rights of appeal under the governing documents have expired;
  (e) The notice of violation states the violation and refers to
the relevant section of the applicable governing document;
  (f) The notice of violation includes information evidencing
compliance with the requirements of this section; and
  (g) The notice of violation is executed by the president and
secretary of the association and acknowledged in the manner
provided for acknowledgment of instruments by the officers.
  (3) A notice of violation may not include information for a
purpose that is not related to a violation described in
subsection (2) of this section.
  (4) An association may record an amendment to a notice of
violation or a notice of termination, which must be executed and
acknowledged by the president and secretary of the association
and must include information identifying the prior recorded
notice and the information required under subsection (2)(e) and
(f) of this section.
  (5) The county clerk may charge a fee for recording a notice of
violation and amendments to a notice of violation or a notice of
termination under this section according to the provisions of ORS
205.320 (4).
  (6) The board of directors shall cause a notice of termination
to be recorded promptly in the county deed records upon the
written request of the owner of the affected lot described in the
notice of violation in accordance with subsection (2)(d) of this
section and a determination that the violations stated in the
notice no longer exist or have otherwise been corrected to the
satisfaction of the board. + }
  SECTION 3. ORS 94.550 is amended to read:
  94.550. As used in ORS 94.550 to 94.783:
  (1) 'Assessment' means any charge imposed or levied by a
homeowners association on or against an owner or lot pursuant to
the provisions of the declaration or the bylaws of the planned
community or provisions of ORS 94.550 to 94.783.
  (2) 'Blanket encumbrance' means a trust deed or mortgage or any
other lien or encumbrance, mechanic's lien or otherwise, securing
or evidencing the payment of money and affecting more than one
lot in a planned community, or an agreement affecting more than
one lot by which the developer holds such planned community under
an option, contract to sell or trust agreement.
  (3) 'Class I planned community' means a planned community as
defined in ORS 94.550 that:
  (a) Contains at least 13 lots or in which the declarant has
reserved the right to increase the total number of lots beyond
12; and
  (b) Has an initial estimated annual assessment, including an
amount required for reserves under ORS 94.595, exceeding $10,000
for all lots or $100 per lot, whichever is greater, based on:
  (A) For a planned community created on or after January 1,
2002, the initial estimated annual assessment, including a
constructive assessment based on a subsidy of the association
through a contribution of funds, goods or services by the
declarant; or
  (B) For a planned community created before January 1, 2002, a
reasonable estimate of the cost of fulfilling existing
obligations imposed by the declaration and bylaws.
  (4) 'Class II planned community' means a planned community as
defined in ORS 94.550 that:
  (a) Is not a Class I planned community;
  (b) Contains at least five lots; and
  (c) Has an estimated annual assessment exceeding $1,000 for all
lots based on:
  (A) For a planned community created on or after January 1,
2002, the initial estimated annual assessment, including a
constructive assessment based on a subsidy of the association
through a contribution of funds, goods or services by the
declarant; or
 
 
  (B) For a planned community created before January 1, 2002, a
reasonable estimate of the cost of fulfilling existing
obligations imposed by the declaration and bylaws.
  (5) 'Class III planned community' means a planned community as
defined in ORS 94.550 that is not a Class I or II planned
community.
  (6) 'Common expenses' means expenditures made by or financial
liabilities incurred by the homeowners association and includes
any allocations to the reserve account under ORS 94.595.
  (7) 'Common property' means any real property or interest in
real property within a planned community which is owned, held or
leased by the homeowners association or owned as tenants in
common by the lot owners, or designated in the declaration for
transfer to the association.
  (8) 'Condominium' means property submitted to the provisions of
ORS chapter 100.
  (9) 'Declarant' means any person who creates a planned
community under ORS 94.550 to 94.785.
  (10) 'Declarant control' means any special declarant right
relating to administrative control of a homeowners association,
including but not limited to:
  (a) The right of the declarant or person designated by the
declarant to appoint or remove an officer or a member of the
board of directors;
  (b) Any weighted vote or special voting right granted to a
declarant or to units owned by the declarant so that the
declarant will hold a majority of the voting rights in the
association by virtue of such weighted vote or special voting
right; and
  (c) The right of the declarant to exercise powers and
responsibilities otherwise assigned by the declaration or bylaws
or by the provisions of ORS 94.550 to 94.783 to the association,
officers of the association or board of directors of the
association.
  (11) 'Declaration' means the instrument described in ORS 94.580
which establishes a planned community, and any amendments to the
instrument.  { +
  (12) 'Governing document' means an instrument or plat relating
to common ownership or common maintenance of a portion of a
planned community and that is binding upon lots within the
planned community. + }
    { - (12) - }  { +  (13) + } 'Homeowners association' or
'association ' means the organization of owners of lots in a
planned community, created under ORS 94.625, required by a
governing document or formed under ORS 94.572.
    { - (13) - }  { +  (14) + } 'Majority' or 'majority of votes'
or ' majority of owners' means more than 50 percent of the votes
in the planned community.
    { - (14) - }  { +  (15) + } 'Mortgagee' means any person who
is:
  (a) A mortgagee under a mortgage;
  (b) A beneficiary under a trust deed; or
  (c) The vendor under a land sale contract.
    { - (15) - }  { +  (16) + } 'Owner' means the owner of any
lot in a planned community, unless otherwise specified, but does
not include a person holding only a security interest in a lot.
    { - (16) - }  { +  (17) + } 'Percent of owners' or
'percentage of owners ' means the owners representing the
specified voting rights as determined under ORS 94.658.
    { - (17) - }   { + (18)(a) + } 'Planned community' means any
subdivision under ORS 92.010 to 92.190   { - which - }  { +
that + } results in a pattern of ownership of real property and
all the buildings, improvements and rights located on or
belonging to the real property, in which the owners collectively
are responsible for the maintenance, operation, insurance or
other expenses relating to any property within the planned
community, including common property, if any, or for the exterior
maintenance of any property that is individually owned.
   { +  (b) + } 'Planned community' does not mean:
    { - (a) - }   { + (A) + } A condominium under ORS chapter
100;
    { - (b) - }   { + (B) + } A planned community that is
exclusively commercial or industrial; or
    { - (c) - }   { + (C) + } A timeshare plan under ORS 94.803
to 94.945.
    { - (18) - }  { +  (19) + } 'Purchaser' means any person
other than a declarant who, by means of a voluntary transfer,
acquires a legal or equitable interest in a lot, other than as
security for an obligation.
    { - (19) - }  { +  (20) + } 'Purchaser for resale' means any
person who purchases from the declarant more than two lots for
the purpose of resale whether or not the purchaser for resale
makes improvements to the lots before reselling them.
    { - (20) - }  { +  (21) + } 'Special declarant rights' means
any rights, in addition to the rights of the declarant as a lot
owner, reserved for the benefit of the declarant under the
declaration or ORS 94.550 to 94.783, including but not limited
to:
  (a) Constructing or completing construction of improvements in
the planned community which are described in the declaration;
  (b) Expanding the planned community or withdrawing property
from the planned community under ORS 94.580 (3) and (4);
  (c) Converting lots into common property;
  (d) Making the planned community subject to a master
association under ORS 94.695; or
  (e) Exercising any right of declarant control reserved under
ORS 94.600.
    { - (21) - }  { +  (22) + } 'Successor declarant' means the
transferee of any special declarant right.
    { - (22) - }  { +  (23) + } 'Turn over' means the act of
turning over administrative responsibility pursuant to ORS 94.609
and 94.616.
    { - (23) - }  { +  (24) + } 'Unit' means a building or
portion of a building located upon a lot in a planned community
and designated for separate occupancy or ownership, but does not
include any building or portion of a building located on common
property.
    { - (24) - }  { +  (25) + } 'Votes' means the votes allocated
to lots in the declaration under ORS 94.580 (2)(h).
  SECTION 4. ORS 94.570 is amended to read:
  94.570. (1) ORS 94.550 to 94.783 apply to a planned community
created before January 1, 2002,  { + as provided in ORS 94.550 to
94.783 + } and to a Class I planned community created on or after
January 1, 2002.
  (2) ORS 94.550 to 94.783, except for ORS 94.595 and 94.604,
apply to a Class II planned community created on or after January
1, 2002.
  (3) Notwithstanding any other provision of ORS 94.550 to
94.783, ORS 94.550 to 94.783 apply to a Class III planned
community or a planned community   { - described in ORS 94.550
(17)(b) - }  { +  that is exclusively commercial or
industrial + } created on or after January 1, 2002, if the
declaration of the planned community so provides.
  (4) Nothing in ORS 94.550 to 94.783 prohibits the establishment
of a condominium subject to ORS chapter 100 or a timeshare plan
subject to ORS 94.803 to 94.945 within a planned community.
  SECTION 5. ORS 94.572 is amended to read:
  94.572. (1)(a) A Class I or Class II planned community created
before January 1, 2002, that is not subject to ORS 94.550 to
94.783 is subject to this section and ORS 94.550, 94.590,  { +
94.595 (4) to (8), 94.625, + } 94.630 (1),  { + (3) and (4), + }
94.640, 94.645, 94.647, 94.650, 94.655, 94.657,  { + 94.658, + }
94.660, 94.662, 94.665, 94.670, 94.675, 94.680, 94.690, 94.695,
94.704, 94.709, 94.712, 94.716, 94.719, 94.723,  { + 94.728, + }
94.733, 94.770, 94.775, 94.777 and 94.780 to the extent that
those statutes are consistent with any governing documents. If
the governing documents do not provide for the formation of an
association, the requirements of this subsection are not
effective until the formation of an association in accordance
with paragraph (b) of this subsection.  If a provision of the
governing documents is inconsistent with this subsection, the
owners may amend the governing documents using the procedures in
this subsection:
  (A) In accordance with the procedures for the adoption of
amendments in the governing documents and subject to any
limitations in the governing documents, the owners may amend the
inconsistent provisions of the governing documents to conform to
the extent feasible with this section and ORS 94.550, 94.590,
 { +  94.595 (4) to (8), 94.625, + } 94.630 (1),  { + (3) and
(4), + } 94.640, 94.645, 94.647, 94.650, 94.655, 94.657,
 { + 94.658, + } 94.660, 94.662, 94.665, 94.670, 94.675, 94.680,
94.690, 94.695, 94.704, 94.709, 94.712, 94.716, 94.719, 94.723,
 { + 94.728, + } 94.733, 94.770, 94.775, 94.777 and 94.780.
Nothing in this paragraph requires the owners to amend a
declaration or bylaws to include the information required by ORS
94.580 or 94.635.
  (B) If there are no procedures for amendment in the governing
documents:
  (i) For an amendment to a recorded governing document other
than bylaws, the owners may amend the inconsistent provisions of
the document to conform to this section and ORS 94.550, 94.590,
 { +  94.595 (4) to (8), 94.625, + } 94.630 (1),  { + (3) and
(4), + } 94.640, 94.645, 94.647, 94.650, 94.655, 94.657,
 { + 94.658, + } 94.660, 94.662, 94.665, 94.670, 94.675, 94.680,
94.690, 94.695, 94.704, 94.709, 94.712, 94.716, 94.719, 94.723,
 { + 94.728, + } 94.733, 94.770, 94.775, 94.777 and 94.780 by a
vote of at least 75 percent of the owners in the planned
community.
  (ii) For an amendment to the bylaws, the owners may amend the
inconsistent provisions of the bylaws to conform to this section
and ORS 94.550, 94.590,  { + 94.595 (4) to (8), 94.625, + }
94.630 (1),  { + (3) and (4), + } 94.640, 94.645, 94.647, 94.650,
94.655, 94.657,  { + 94.658, + } 94.660, 94.662, 94.665, 94.670,
94.675, 94.680, 94.690, 94.695, 94.704, 94.709, 94.712, 94.716,
94.719, 94.723,  { + 94.728, + } 94.733, 94.770, 94.775, 94.777
and 94.780 by a vote of at least a majority of the owners in the
planned community.
  (iii) The amendment may be adopted at a meeting held in
accordance with the governing documents or by another procedure
permitted by the governing documents following the procedures
prescribed in ORS 94.647, 94.650 or 94.660.
  (iv) An amendment to a recorded declaration shall be executed,
certified and recorded as provided in ORS 94.590 (2) and (3) and
shall be subject to ORS 94.590 (5). An amendment to the bylaws
and any other governing document shall be executed and certified
as provided in ORS 94.590 (3) and shall be recorded in the office
of the recording officer of every county in which the planned
community is located if the bylaws or other governing document to
which the amendment relates were recorded.
  (C) An amendment adopted pursuant to this paragraph shall
include:
  (i) A reference to the recording index numbers and date of
recording of the declaration or other governing document, if
recorded, to which the amendment relates; and
  (ii) A statement that the amendment is adopted pursuant to the
applicable subparagraph of this paragraph.
  (b)(A) If the governing documents do not provide for the
formation of an association of owners, at least 10 percent of the
owners in the planned community or any governing entity may
initiate the formation of an association as provided in this
paragraph. The owners or the governing entity initiating the
association formation shall call an organizational meeting for
the purpose of voting whether to form an association described in
ORS 94.625. The notice of the meeting shall:
  (i) Name the initiating owners or governing entity;
  (ii) State that the organizational meeting is for the purpose
of voting whether to form an association in accordance with the
proposed articles of incorporation;
  (iii) State that if the owners vote to form an association, the
owners may elect the initial board of directors provided for in
the articles of incorporation and may adopt the initial bylaws;
  (iv) State that to form an association requires an affirmative
vote of at least a majority of the owners in the planned
community, or, if a larger percentage is specified in the  { +
applicable + } governing   { - documents - }  { +  document to
amend a governing document + }, the larger percentage;
  (v) State that to adopt articles of incorporation, to elect the
initial board of directors pursuant to the articles of
incorporation or to adopt the initial bylaws requires an
affirmative vote of at least a majority of the owners present;
  (vi) State that if the initial board of directors is not
elected, an interim board of directors shall be elected pursuant
to bylaws adopted as provided in subparagraph (C) of this
paragraph;
  (vii) State that a copy of the proposed articles of
incorporation and bylaws will be available at least five business
days before the meeting and state the method of requesting a
copy; and
  (viii) Be delivered in accordance with the declaration and
bylaws. If there is no governing document or the document does
not include applicable provisions, the owners or governing entity
shall follow the procedures prescribed in ORS 94.650 (3).
  (B) At least five business days before the organizational
meeting, the initiating owners or governing entity shall cause
articles of incorporation and bylaws to be drafted. The bylaws
shall include, to the extent applicable, the information required
by ORS 94.635.
  (C) At the organizational meeting:
  (i) Representatives of the initiating owners or governing
entity shall, to the extent not inconsistent with the governing
documents, conduct the meeting according to Robert's Rules of
Order as provided in ORS 94.657.
  (ii) The initiating owners or governing entity shall make
available copies of the proposed articles of incorporation and
the proposed bylaws.
  (iii) The affirmative vote of at least a majority of the owners
of a planned community, or, if a larger percentage is specified
in the  { + applicable + } governing   { - documents - }  { +
document to amend a governing document + }, the larger
percentage, is required to form an association under this
paragraph.
  (iv) If the owners vote to form an association, the owners
shall adopt articles of incorporation and may elect the initial
board of directors as provided in the articles of incorporation,
adopt bylaws and conduct any other authorized business by an
affirmative vote of at least a majority of the owners present. If
the owners do not elect the initial board of directors, owners
shall elect an interim board of directors by an affirmative vote
of at least a majority of the owners present to serve until the
initial board of directors is elected.
   { +  (v) An owner may vote by proxy or absentee ballot if
approved, in the discretion of the initiating owners or governing
entity. + }
 
  (D) Not later than 10 business days after the organizational
meeting, the board of directors shall:
  (i) Cause the articles of incorporation to be filed with the
Secretary of State under ORS chapter 65;
  (ii) Cause the notice of planned community described in
subsection (4) of this section to be prepared, executed and
recorded in accordance with subsection (4) of this section
 { - . - }  { + ; + }
  (iii) Provide a copy of the notice of planned community to each
owner, together with a copy of the adopted articles of
incorporation and bylaws, if any, or a statement of the procedure
and method for adoption of bylaws described in subparagraph (C)
of this paragraph. The copies and any statement shall be
delivered to each lot, mailed to the mailing address of each lot
or mailed to the mailing addresses designated by the owners in
writing; and
  (iv) Cause a statement of association information to be
prepared, executed and recorded in accordance with ORS 94.667.
  (E) If the owners vote to form an association, all costs
incurred under this paragraph, including but not limited to the
preparation and filing of the articles of incorporation, drafting
of bylaws, preparation of notice of meeting and the drafting,
delivery and recording of all notices and statements shall be a
common expense of the owners and shall be allocated as provided
in the appropriate governing document or any amendment thereto.
  (2)(a) The owners of lots in a Class I or Class II planned
community that are subject to the provisions of ORS chapter 94
specified in subsection (1) of this section may elect to be
subject to any other provisions of ORS 94.550 to 94.783 upon
compliance with the procedures prescribed in subsection (1) of
this section.
  (b) If the owners of lots in a Class I or Class II planned
community elect to be subject to additional provisions of ORS
94.550 to 94.783, unless the notice of planned community
otherwise required or permitted under subsection (4) of this
section includes a statement of the election pursuant to this
paragraph, the board of directors of the association shall cause
the notice of planned community described in subsection (4) of
this section to be prepared, executed and recorded in accordance
with subsection (4) of this section.
  (3)(a) The owners of lots in a Class III planned community
created before January 1, 2002, may elect to be subject to
provisions of ORS 94.550 to 94.783 upon compliance with the
applicable procedures in subsection (1) of this section.
  (b) If the owners of lots in a Class III planned community
elect to be subject to provisions of ORS 94.550 to 94.783, the
board of directors of the association shall cause the notice of
planned community described in subsection (4) of this section to
be prepared, executed and recorded in accordance with subsection
(4) of this section.
  (4) The notice of planned community required or permitted by
this section shall be:
  (a) Titled 'Notice of Planned Community' under this section;
  (b) Executed by the president and secretary of the association;
and
  (c) Recorded in the office of the recording officer of every
county in which the property is located.
  (5) The notice of planned community shall include:
  (a) The name of the planned community and association as
identified in the recorded declaration, conditions, covenants and
restrictions or other governing document and, if different, the
current name of the association;
  (b) A list of the properties, described as required for
recordation in ORS 93.600, within the jurisdiction of the
association;
 
  (c) Information identifying the recorded declaration,
conditions, covenants and restrictions or other governing
documents and a reference to the recording index numbers and date
of recording of the governing documents;
  (d) A statement that the property described in accordance with
paragraph (b) of this subsection is subject to specific
provisions of the Planned Community Act;
  (e) A reference to the specific provisions of the Planned
Community Act that apply to the subject property and a reference
to the subsection of this section under which the application is
made; and
  (f) If an association is formed under subsection (1)(b)(A) of
this section, a statement to that effect.
  (6) An amended statement shall include a reference to the
recording index numbers and the date of recording of prior
statements.
  (7) The county clerk may charge a fee for recording a statement
under this section according to the provisions of ORS 205.320
(4).
   { +  (8) The board of directors of an association not
otherwise required to cause a notice of planned community
described in subsection (4) of this section to be prepared and
recorded under this section may cause a notice of planned
community to be prepared, executed and recorded as provided in
this section. + }
    { - (8) - }   { + (9) + } Title to a unit, lot or common
property in a Class I or Class II planned community created
before January 1, 2002, may not be rendered unmarketable or
otherwise affected by a failure of the planned community to be in
compliance with a requirement of this section.
    { - (9) - }   { + (10) + } As used in this section:
  (a) 'Governing document' means an instrument or plat relating
to common ownership or common maintenance of a portion of a
planned community and that is binding upon lots within the
planned community.
  (b) 'Governing entity' means an incorporated or unincorporated
association, committee, person or any other entity that has
authority, under a governing document, to maintain commonly
maintained property, impose assessments on lots or to act on
behalf of lot owners within the planned community on matters of
common concern.
  (c) 'Recorded declaration' means an instrument recorded with
the county recording officer of the county in which the planned
community is located that contains conditions, covenants and
restrictions binding lots in the planned community or imposes
servitudes upon the real property.
  SECTION 6. ORS 94.590 is amended to read:
  94.590. (1)(a) The   { - homeowners association may amend the
declaration and the plat only by vote or agreement - }
 { + declaration may be amended only with the approval + } of the
owners representing at least 75 percent of the total votes in the
planned community or any larger percentage specified in the
declaration.
  (b) An amendment under this section may not   { - create, - }
 { + :
  (A)  + }Limit or diminish any  { + right of a declarant
reserved under ORS 94.580 (3) or (4) or any other + } special
declarant   { - rights, increase the number of lots or units
or - }   { + right without the consent of the declarant.
Declarant may waive declarant's right of consent.
  (B) + } Change the boundaries of any lot or any uses to which
any lot or unit is restricted { + , change the method of
determining liability for common expenses, change the right to
common profits or change voting rights of any lot or unit as
stated in the declaration in accordance with ORS 94.580
 
 + }unless the owners of the affected lots unanimously consent to
the amendment.
   { +  (c) Any changes to the plat, including required approvals
or consents of owners or others, are governed by the applicable
provisions of ORS 92.010 to 92.190. + }
  (2)(a) Unless otherwise provided in the declaration, an
amendment to the declaration may be proposed by a majority of the
board of directors or by at least 30 percent of the owners in the
planned community.
  (b) When the association adopts an amendment to the
declaration, the association shall record the amendment in the
  { - same place as the declaration - }  { +  office of the
recording officer in each county in which the planned community
is located + }. An amendment of the declaration is effective only
upon recordation.
  (3) Notwithstanding a provision in a declaration that requires
amendments to be executed and acknowledged by all owners
approving the amendment, amendments to a declaration under this
section shall be executed and certified on behalf of the
association by the president and secretary as being adopted in
accordance with the declaration and the provisions of this
section and acknowledged in the manner provided for
acknowledgment of deeds.
  (4) An amendment to a declaration or plat shall be conclusively
presumed to have been regularly adopted in compliance with all
applicable procedures relating to such amendment unless an action
is brought within one year after the date such amendment was
recorded or the face of the recorded amendment indicates that the
amendment received the approval of fewer votes than required for
such approval. However, nothing in this subsection shall prevent
the further amendment of an amended declaration or plat.
  (5) During any period of declarant control, voting on an
amendment under subsection (1) of this section shall be without
regard to any weighted vote or special voting right reserved by
the declarant except as otherwise provided under ORS 94.585.
Nothing in this subsection is intended to prohibit a declarant
from reserving the right to require the declarant's consent to an
amendment during the period reserved in the declaration for
declarant control.
   { +  (6) The board of directors may, upon the adoption of a
resolution, cause to be prepared and recorded a restated
declaration to codify individual amendments that have been
adopted in accordance with this section or ORS 94.585 without the
further approval of owners. A declaration restated under this
subsection must:
  (a) Include all previously adopted amendments in effect and may
not include any other changes except to correct scrivener's
errors or to conform format and style;
  (b) Include a statement that the board of directors has adopted
a resolution in accordance with this subsection and is causing
the declaration to be restated and recorded under this
subsection;
  (c) Include a reference to the recording index numbers and date
of recording of the initial declaration and all previously
recorded amendments in effect being codified;
  (d) Include a certification by the president and secretary of
the association that the restated declaration includes all
previously adopted amendments in effect and no other changes,
except, if applicable, to correct scrivener's errors or to
conform format and style; and
  (e) Be executed and acknowledged by the president and secretary
of the association and recorded in the deed records of each
county in which the planned community is located. + }
  SECTION 7. ORS 94.595 is amended to read:
  94.595. (1) The declarant shall:
 
  (a) Conduct a reserve study described in subsection (3) of this
section; and
  (b) Establish a reserve account for replacement of all items of
common property which will normally require replacement, in whole
or in part, in more than three and less than 30 years, for
exterior painting if the common property includes exterior
painted surfaces, for other items, whether or not involving
common property, if the association has responsibility to
maintain the items and for other items required by the
declaration or bylaws.  The reserve account need not include
reserves for those items:
  (A) That could reasonably be funded from operating assessments;
or
  (B) For which one or more owners are responsible for
maintenance and replacement under the provisions of the
declaration or bylaws.
  (2)(a) A reserve account established under this section shall
be funded by assessments against the individual lots for
maintenance of items for which the reserves are established.
  (b) The assessments under this subsection begin accruing from
the date the first lot assessed is conveyed.
  (3)(a) The reserve account shall be established in the name of
the homeowners association. The association is responsible for
administering the account and for making periodic payments into
the account.
  (b) The reserve portion of the initial assessment determined by
the declarant shall be based on:
  (A) The reserve study described in paragraph (c) of this
subsection; or
  (B) Other sources of reliable information.
  (c) The board of directors of the association annually shall
conduct a reserve study or review and update an existing study to
determine the reserve account requirements and may:
  (A) Adjust the amount of payments as indicated by the study or
update; and
  (B) Provide for other reserve items that the board of
directors, in its discretion, may deem appropriate.
  (d) The reserve study shall include:
  (A) Identification of all items for which reserves are required
to be established;
  (B) The estimated remaining useful life of each item as of the
date of the reserve study;
  (C) The estimated cost of maintenance, repair or replacement of
each item at the end of its useful life; and
  (D) A 30-year plan with regular and adequate contributions,
adjusted by estimated inflation and interest earned on reserves,
to meet the maintenance, repair and replacement schedule.
  (4)(a) If the declaration or bylaws require a reserve account,
the reserve study requirements of subsection (3) of this section
first apply to the association of a subdivision that meets the
definition of a planned community under ORS 94.550 and is
recorded prior to October 23, 1999, when:
  (A) The board of directors adopts a resolution in compliance
with the bylaws that applies the requirements of subsection (3)
of this section to the association; or
  (B) A petition signed by a majority of owners is submitted to
the board of directors mandating that the requirements of
subsection (3) of this section apply to the association.
  (b) A reserve study shall be completed within one year of
adoption of the resolution or submission of the petition to the
board of directors.
  (5)(a) The reserve account may be used only for the purposes
for which reserves have been established and is to be kept
separate from other funds.
  (b) After the individual lot owners have assumed responsibility
for administration of the planned community under ORS 94.616,
 { + if the board of directors has adopted a resolution, which
may be an annual continuing resolution, authorizing the borrowing
of funds, + } the board of directors may borrow funds from the
reserve account to meet high seasonal demands on the regular
operating funds or to meet unexpected increases in expenses.
  { - Funds borrowed under this subsection must be repaid later
from assessments if the board of directors has adopted a
resolution, which may be an annual continuing resolution,
authorizing the borrowing of funds. - }  Not later than the
adoption of the budget for the following year, the board of
directors shall adopt by resolution a written payment plan
providing for repayment of the borrowed funds within a reasonable
period.
  (6) Nothing in this section prohibits prudent investment of
reserve account funds subject to any constraints imposed by the
declaration, bylaws or rules of the association.
  (7) In addition to the authority of the board of directors
under subsection (3)(c) of this section, following the second
year after the association has assumed administrative
responsibility for the planned community under ORS 94.616:
  (a) By an affirmative vote of at least 75 percent of the owners
of the planned community, the association may elect to reduce or
increase future assessments for the reserve account; and
  (b) The association may, on an annual basis by a unanimous
vote, elect not to fund the reserve account.
  (8) Assessments paid into the reserve account are the property
of the association and are not refundable to sellers or owners of
lots.
  SECTION 8. ORS 94.604 is amended to read:
  94.604. (1) As provided in this section, the declarant or the
owners of a planned community  { + that contains at least 20
units in either the initial development or with the annexation of
additional property + } shall form a transitional advisory
committee to provide for the transition from administrative
responsibility by the declarant of the planned community under
ORS 94.600 to administrative responsibility by the association.
The declarant shall call a meeting of owners for the purpose of
selecting a transitional advisory committee not later than the
60th day after
  { - the later of: - }
    { - (a) - }  the date the declarant conveys 50 percent or
more of the lots   { - in the first or only phase of the planned
community to owners other than a successor declarant; or - }
    { - (b) The date the declarant has conveyed 10 lots - }  in
the planned community to owners other than a successor declarant.
  (2) The transitional advisory committee shall consist of three
or more members. The owners, other than the declarant, shall
select two or more members. The declarant may select no more than
one member. The committee shall have reasonable access to all
information and documents which the declarant is required to turn
over to the association under ORS 94.616.
  (3) An owner may call a meeting of owners to select the
transitional advisory committee if the declarant fails to do so
under subsection (1) of this section.
  (4) Notwithstanding subsection (1) of this section, if the
owners do not select members for the transitional advisory
committee under subsection (2) of this section, the declarant
shall have no further obligation to form the committee.
  (5) The requirement for a transitional advisory committee shall
not apply once the turnover meeting called under ORS 94.609 has
been held.
  SECTION 9. ORS 94.625 is amended to read:
  94.625. (1) Not later than the date on which the first lot in
the planned community is conveyed, the declarant shall:
  (a) Organize the association as a nonprofit corporation under
ORS chapter 65;
  (b) Adopt, on behalf of the association, the initial bylaws
required under ORS 94.635 to govern the administration of the
planned community; and
  (c) Record the bylaws in the office of the recording officer in
each county in which the planned community is located.
  (2) Unless otherwise provided in the bylaws, amendments to the
bylaws may be proposed by a majority of the board of directors or
by at least 30 percent of the owners of the planned community.
  (3) Subject to subsection (4) of this section, an amendment is
not effective unless the amendment is:
  (a) Approved, unless otherwise provided in the bylaws, by a
majority of the votes in a planned community present, in person
or by proxy, at a duly constituted meeting { + , + }   { - or by
ballot vote - }  { +  by written ballot in lieu of a meeting
under ORS 94.647 or other procedure permitted under the
declaration or bylaws + };
  (b) Certified by the president and secretary of the association
as having been adopted in accordance with the bylaws and this
section  { + and acknowledged in the manner provided for
acknowledgment of deeds if the amendment is required to be
recorded under paragraph (c) of this subsection + }; and
  (c) Recorded in the office of the recording officer if the
bylaws to which the amendment relates were recorded.
  (4) If a provision required to be in the declaration under ORS
94.580 is included in the bylaws, the voting requirements for
amending the declaration shall also govern the amendment of the
provision in the bylaws.
   { +  (5) Notwithstanding a provision in the bylaws, including
bylaws adopted prior to the effective date of this 2003 Act, that
requires amendments to be executed or executed and acknowledged
by all owners approving the amendment, amendments to the bylaws
under this section become effective after approval by the owners
if only executed and certified on behalf of the association by
the president and secretary in accordance with subsection (3)(b)
of this section.
  (6) An amendment to the bylaws is conclusively presumed to have
been regularly adopted in compliance with all applicable
procedures relating to the amendment unless an action is brought
within one year after the effective date of the amendment or the
face of the amendment indicates that the amendment received the
approval of fewer votes than required for approval. Nothing in
this subsection prevents the further amendment of an amended
bylaw. + }
    { - (5) - }   { + (7) + } Failure to comply with subsection
(1) of this section does not invalidate a conveyance from the
declarant to an owner.
   { +  (8) The board of directors, by resolution, may cause
restated bylaws to be prepared and recorded to codify individual
amendments that have been adopted in accordance with subsection
(3) of this section without the further approval of owners.
Bylaws restated under this subsection shall:
  (a) Include all previously adopted amendments in effect and may
not include any other changes except to correct scrivener's
errors or to conform format and style;
  (b) Include a statement that the board of directors has adopted
a resolution in accordance with this subsection and is causing
the bylaws to be restated and recorded under this subsection;
  (c) Include a reference to the recording index numbers and date
of recording of the initial bylaws, if recorded, and all
previously recorded amendments in effect being codified;
  (d) Include a certification by the president and secretary of
the association that the restated bylaws include all previously
adopted amendments in effect and no other changes, except, if
applicable, to correct scrivener's errors or to conform form and
style; and
 
  (e) Be executed and acknowledged by the president and secretary
of the association and recorded in the deed records of each
county in which the planned community is located. + }
  SECTION 10. ORS 94.630 is amended to read:
  94.630. (1) Subject to subsection (2) of this section and
except as otherwise provided in its declaration or bylaws, a
homeowners association may:
  (a) Adopt and amend bylaws, rules and regulations for the
planned community;
  (b) Adopt and amend budgets for revenues, expenditures and
reserves, and collect assessments from owners for common expenses
and the reserve account established under ORS 94.595;
  (c) Hire and terminate managing agents and other employees,
agents and independent contractors;
  (d) Defend against any claims, proceedings or actions brought
against it;
  (e) Subject to subsection (4) of this section, initiate or
intervene in litigation or administrative proceedings in its own
name and without joining the individual owners in the following:
  (A) Matters relating to the collection of assessments and the
enforcement of governing documents;
  (B) Matters arising out of contracts to which the association
is a party;
  (C) Actions seeking equitable or other nonmonetary relief
regarding matters that affect the common interests of the owners,
including but not limited to the abatement of nuisance;
  (D) Matters relating to or affecting common property, including
but not limited to actions for damage, destruction, impairment or
loss of use of any common property;
  (E) Matters relating to or affecting the lots or interests of
the owners including but not limited to damage, destruction,
impairment or loss of use of a lot or portion thereof, if:
  (i) Resulting from a nuisance or a defect in or damage to
common property; or
  (ii) Required to facilitate repair to any common property; and
  (F) Any other matter to which the association has standing
under law or pursuant to the declaration or bylaws;
  (f) Make contracts and incur liabilities;
  (g) Regulate the use, maintenance, repair, replacement and
modification of common property;
  (h) Cause additional improvements to be made as a part of the
common property;
  (i) Acquire, hold, encumber and convey in its own name any
right, title or interest to real or personal property, except
that common property may be conveyed or subjected to a security
interest only pursuant to ORS 94.665;
  (j) Grant easements, leases, licenses and concessions through
or over the common property;
  (k) Modify, close, remove, eliminate or discontinue the use of
common property, including any improvement or landscaping,
regardless of whether the common property is mentioned in the
declaration, provided that:
  (A) Nothing in this paragraph is intended to limit the
authority of the association to seek approval of the
modification, closure, removal, elimination or discontinuance by
the owners; and
  (B) Modification, closure, removal, elimination or
discontinuance other than on a temporary basis of any swimming
pool, spa or recreation or community building must be approved by
at least a majority of owners voting on the matter at a meeting
or by written ballot held in accordance with the declaration,
bylaws or ORS 94.647;
  (L) Impose and receive any payments, fees or charges for the
use, rental or operation of the common property and services
provided to owners;
 
  (m) Adopt rules regarding the termination of utility services
paid for out of assessments of the association and access to and
use of recreational and service facilities available to owners
and, after giving  { + written + } notice and an opportunity to
be heard, terminate the rights of any owners to receive such
benefits or services until the correction of any violation
covered by such rule has occurred;
  (n) Impose charges for late payment of assessments and attorney
fees related to the collection of assessments and, after giving
written notice and an opportunity to be heard, levy reasonable
fines for violations of the declaration, bylaws, rules and
regulations of the association if the charge imposed or the fine
levied is based on a schedule contained in the declaration or
bylaws, or an amendment to either that is delivered to each lot,
mailed to the mailing address of each lot or mailed to the
mailing addresses designated in writing by the owners, or based
on a resolution of the association or its board of directors that
is delivered to each lot, mailed to the mailing address of each
lot or mailed to the mailing addresses designated in writing by
the owners;
  (o) Impose reasonable charges for the preparation and
recordation of amendments to the declaration;
  (p) Provide for the indemnification of its officers and the
board of directors and maintain liability insurance for directors
and officers;
  (q) Assign its right to future income, including the right to
receive common expense assessments; and
  (r) Exercise any other powers necessary and proper for the
administration and operation of the association.
  (2) Notwithstanding subsection (1) of this section, a
declaration may not impose any limitation on the ability of the
association to deal with a declarant that is more restrictive
than the limitations imposed on the ability of the association to
deal with any other person, except during the period of declarant
control under ORS 94.600.
  (3) A permit or authorization, or an amendment, modification,
termination or other instrument affecting a permit or
authorization, issued by the board of directors that is
authorized by law, the declaration or bylaws may be recorded in
the deed records of the county in which the planned community is
located. A permit or authorization, or an amendment,
modification, termination or other instrument affecting a permit
or authorization, recorded under this subsection shall:
  (a) Be executed by the president and secretary of the
association and acknowledged in the manner provided for
acknowledgment of instruments by the officers;
  (b) Include the name of the planned community and a reference
to where the declaration and any applicable supplemental
declarations are recorded;
  (c) Identify, by the designations stated or referenced in the
declaration or applicable supplemental declaration, all affected
lots and common property; and
  (d) Include other information and signatures if required by
law, the declaration, bylaws or the board of directors.
  (4)(a) Subject to paragraph (f) of this subsection, before
initiating litigation or an administrative proceeding in which
the association and an owner have an adversarial relationship,
the party that intends to initiate litigation or an
administrative proceeding shall offer to use any dispute
resolution program available within the county in which the
planned community is located that is in substantial compliance
with the standards and guidelines adopted under ORS 36.175. The
written offer must be hand-delivered or mailed by certified mail,
return receipt requested, to the address, contained in the
records of the association, for the other party.
 
  (b) If the party receiving the offer does not accept the offer
within 10 days after receipt by written notice hand-delivered or
mailed by certified mail, return receipt requested, to the
address, contained in the records of the association, for the
other party, the initiating party may commence the litigation or
the administrative proceeding. The notice of acceptance of the
offer to participate in the program must contain the name,
address and telephone number of the body administering the
dispute resolution program.
  (c) If a qualified dispute resolution program exists within the
county in which the planned community is located and an offer to
use the program is not made as required under paragraph (a) of
this subsection, litigation or an administrative proceeding may
be stayed for 30 days upon a motion of the noninitiating party.
If the litigation or administrative action is stayed under this
paragraph, both parties shall participate in the dispute
resolution process.
  (d) Unless a stay has been granted under paragraph (c) of this
subsection, if the dispute resolution process is not completed
within 30 days after receipt of the initial offer, the initiating
party may commence litigation or an administrative proceeding
without regard to whether the dispute resolution is completed.
  (e) Once made, the decision of the court or administrative body
arising from litigation or an administrative proceeding may not
be set aside on the grounds that an offer to use a dispute
resolution program was not made.
  (f) The requirements of this subsection do not apply to
circumstances in which irreparable harm to a party will occur due
to delay or to litigation or an administrative proceeding
initiated to collect assessments, other than assessments
attributable to fines.
  SECTION 11. ORS 94.640 is amended to read:
  94.640. (1) The board of directors of an association may act on
behalf of the association except as limited by the declaration
and the bylaws. In the performance of their duties, officers and
members of the board of directors   { - shall exercise the care
required of fiduciaries - }   { + are governed by this section
and the applicable provisions of ORS chapter 65 whether or not
the association is incorporated under ORS chapter 65 + }.
  (2) Unless otherwise provided in the bylaws, the board of
directors may fill vacancies in its membership for the unexpired
portion of any term.
  (3) At least annually, the board of directors of an association
shall review the insurance coverage of the association.
  (4) The board of directors of the association annually shall
cause to be filed the necessary income tax returns for the
association.
  (5) The board of directors of the association may record a
statement of association information as provided in ORS 94.667.
  (6) Unless otherwise provided in the declaration or bylaws, the
owners may remove any member of the board of directors, other
than members appointed by the declarant or persons who are ex
officio directors, with or without cause, by a majority vote of
all owners present and entitled to vote at any meeting of the
owners at which a quorum is present. No removal of a director is
effective unless the matter of removal is an item on the agenda
and stated in the notice for the meeting required under ORS
94.650.
  (7)(a) All meetings of the board of directors of the
association shall be open to owners, except that at the
discretion of the board the following matters may be considered
in executive session:
  (A) Consultation with legal counsel concerning the rights and
duties of the association regarding existing or potential
litigation, or criminal matters;
 
  (B) Personnel matters, including salary negotiations and
employee discipline;   { - and - }
  (C) The negotiation of contracts with third parties  { - . - }
 { + ; and + }
   { +  (D) Violation of the declaration, bylaws or other
governing document, including a rule or regulation adopted
pursuant to a governing document, if permitted under paragraph
(b) of this subsection.
  (b) Subject to subparagraph (B) of this paragraph, unless the
declaration or bylaws provide otherwise, a hearing on an alleged
violation of the declaration or bylaws or other governing
document, including any rule or regulation adopted pursuant to a
governing document, held by the board of directors must be
conducted in an open meeting of the board. The board may vote to
deliberate in executive session after a hearing held in an open
meeting of the board. The owner who is alleged to have committed
the violation may:
  (A) Request in writing that the hearing be conducted by the
board of directors in executive session. Upon receipt of a
request from an owner, the board may vote to hold the hearing in
executive session; and
  (B) Attend the hearing and testify concerning the alleged
violation, but the board of directors may exclude such owner from
any deliberations of the board held in executive session. + }
    { - (b) - }   { + (c) + } Except in the case of an emergency,
the board of directors of an association shall vote in an open
meeting whether to meet in executive session. If the board of
directors votes to meet in executive session, the presiding
officer of the board of directors shall state the general nature
of the action to be considered   { - and - } , as precisely as
possible, when and under what circumstances the deliberations can
be disclosed to owners  { + and include the general nature of the
action in the minutes of the meeting + }.   { +
  (d) A contract or an action considered in executive session
does not become effective unless the board of directors,
following the executive session, reconvenes in open meeting and
votes on the contract or an action, which shall be reasonably
identified in the open meeting and included in the minutes. + }
    { - (c) - }   { + (e) + } The meeting and notice requirements
in this section may not be circumvented by chance or social
meetings or by any other means.
   { +  (f) Unless the bylaws specifically authorize, directors
may not vote by proxy or secret ballot at board meetings. + }
  (8) In a planned community in which the majority of the lots
are the principal residences of the occupants, meetings shall be
called as follows:
  (a) For other than emergency meetings, notice of board of
directors' meetings shall be posted at a place or places on the
property at least three days prior to the meeting or notice shall
be provided by a method otherwise reasonably calculated to inform
lot owners of such meetings;
  (b) Emergency meetings may be held without notice, if the
reason for the emergency is stated in the minutes of the meeting;
and
  (c) Only emergency meetings of the board of directors may be
conducted by telephonic communication.
  (9) The board of directors, in the name of the association,
shall maintain a current mailing address of the association.
   { +  (10) The board of directors shall cause to be maintained
and kept current the information required to enable the
association to comply with ORS 94.670 (7).
  (11) As used in this section, 'meeting' means a convening of a
quorum of members of the board of directors where matters
relating to association business are discussed. + }
  SECTION 12. ORS 94.647 is amended to read:
 
  94.647. (1) Unless prohibited or limited by the declaration or
bylaws, any action that may be taken at any annual, regular or
special meeting of the homeowners association may be taken
without a meeting if the association delivers a written ballot to
every association member that is entitled to vote on the
matter. { +  Action by written ballot may not substitute for the
following meetings:
  (a) A turnover meeting required under ORS 94.616.
  (b) An annual meeting of an association if more than a majority
of the lots are the principal residences of the occupants. + }
  (2)(a) A written ballot shall set forth each proposed action
and provide an opportunity to vote for or against each proposed
action.
  (b) The board of directors must provide owners with at least 10
days' notice before written ballots are mailed or otherwise
delivered. If, at least three days before written ballots are
scheduled to be mailed or otherwise distributed, at least 10
percent of the owners petition the board of directors requesting
secrecy procedures, a written ballot must be accompanied by { + :
  (A) + } A secrecy envelope { + ; + }   { - , - }
   { +  (B) + } A return identification envelope to be signed by
the owner { + ; + } and
   { +  (C) + } Instructions for marking and returning the
ballot.
   { +  (c) The notice required under paragraph (b) of this
subsection shall state:
  (A) The general subject matter of the vote by written ballot;
  (B) The right of owners to request secrecy procedures specified
in paragraph (b) of this subsection;
  (C) The secrecy procedures specified in paragraph (b) of this
subsection;
  (D) The date after which ballots may be distributed;
  (E) The date and time by which any petition must be received by
the board requesting secrecy procedures; and
  (F) The address where any petition must be delivered.
  (d) + } Notwithstanding the applicable provisions of subsection
(3) or (4) of this section, written ballots that are returned in
secrecy envelopes may not be examined or counted before the
deadline for returning ballots has passed.
  (3) Matters that may be voted on by written ballot shall be
deemed approved or rejected as follows:
  (a) If approval of a proposed action otherwise would require a
meeting at which a certain quorum must be present and at which a
certain percentage of total votes cast is required to authorize
the action, the proposal shall be deemed to be approved when the
date for the return of ballots has passed, a quorum of owners has
voted and the required percentage of approving votes has been
received. Otherwise, the proposal shall be deemed to be rejected;
or
  (b) If approval of a proposed action otherwise would require a
meeting at which a specified percentage of owners must authorize
the action, the proposal shall be deemed to be approved when the
percentage of total votes cast in favor of the proposal equals or
exceeds such required percentage. The proposal shall be deemed to
be rejected when the number of votes cast in opposition renders
approval impossible or when both the date for return of ballots
has passed and such required percentage has not been met. Unless
otherwise prohibited by the declaration or bylaws, the votes may
be counted from time to time before the final return date to
determine whether the proposal has passed or failed by the votes
already cast on the date they are counted.
  (4) All solicitations for votes by written ballot shall state
the following:
  (a) If approval of a proposal by written ballot requires that
the total number of votes cast equal or exceed a certain quorum
 
requirement, the number of responses needed to meet such quorum
requirement; and
  (b) If approval of a proposal by written ballot requires that a
certain percentage of total votes cast approve the proposal, the
required percentage of total votes needed for approval.
  (5) All solicitations for votes by written ballot shall specify
the period during which the association shall accept written
ballots for counting, which period shall end on the earliest of
the following dates:
  (a) If approval of a proposed action by written ballot requires
that a certain percentage of the owners approve the proposal, the
date on which the association has received a sufficient number of
approving ballots;
  (b) If approval of a proposed action by written ballot requires
that a certain percentage of the owners approve the proposal, the
date on which the association has received a sufficient number of
disapproving ballots to render approval impossible; or
  (c) In all cases, the date certain on which all ballots must be
returned to be counted.
  (6) Except as otherwise provided in the declaration or bylaws,
a written ballot may not be revoked.
  SECTION 13. ORS 94.660 is amended to read:
  94.660.  { + (1) + } Unless the bylaws provide otherwise, the
vote or votes of a lot may be cast by absentee ballot or pursuant
to a proxy executed by the owner.
   { +  (2) + } An owner may not revoke a proxy given pursuant to
this section except by actual notice of revocation to the person
presiding over a meeting of the association { +  or to the board
of directors if a vote is being conducted by written ballot in
lieu of a meeting pursuant to ORS 94.647 + }.
   { +  (3) + } A proxy   { - shall not be - }   { + is not + }
valid if it is undated or purports to be revocable without
notice. A proxy shall terminate one year after its date unless
the proxy specifies a shorter term.
   { +  (4) Unless otherwise provided in the declaration or
bylaws, the board of directors has the authority to prescribe by
resolution the form of the instrument designating a proxy. + }
  SECTION 14. ORS 94.670 is amended to read:
  94.670. (1) { + (a) + } A homeowners association shall retain
within this state the documents, information and records
delivered to the association under ORS 94.616 { +  and all other
records of the association for not less than the period specified
for the record in ORS chapter 65 or any other applicable law + }.
 { +
  (b) The documents specified in ORS 94.616 (3)(o), if received,
must be retain as permanent records of the association. + }
  (2) All assessments, including declarant subsidies, shall be
deposited in a separate bank account, located within this state,
in the name of the association. All expenses of the association
shall be paid from the association bank account.
  (3) The association shall keep financial records sufficiently
detailed for proper accounting purposes. Within 90 days after the
end of the fiscal year, the board of directors shall { + :
  (a) Prepare or cause to be prepared an annual financial
statement consisting of a balance sheet and income and expenses
statement for the preceding fiscal year; and
  (b)  + }Distribute to each owner and, upon written request, any
mortgagee of a lot, a copy of the annual financial statement
  { - consisting of a balance sheet and income and expenses
statement for the preceding fiscal year - } .
  (4)(a) The association shall provide, within 10 business days
of receipt of a written request from an owner, a written
statement that provides:
  (A) The amount of assessments due from the owner and unpaid at
the time the request was received, including:
  (i) Regular and special assessments;
  (ii) Fines and other charges;
  (iii) Accrued interest; and
  (iv) Late payment charges.
  (B) The percentage rate at which interest accrues on
assessments that are not paid when due.
  (C) The percentage rate used to calculate the charges for late
payment or the amount of a fixed charge for late payment.
  (b) The association is not required to comply with paragraph
(a) of this subsection if the association has commenced
litigation by filing a complaint against the owner and the
litigation is pending when the statement would otherwise be due.
  (5) { + (a) Except as provided in paragraph (b) of this
subsection, + } the association shall make the documents,
information and records described in subsections (1) and (3) of
this section and all other records of the association reasonably
available for examination  { + and, upon written request,
available for duplication + } by an owner and any mortgagee of a
lot.   { - Upon the written request of an owner or mortgagee of a
lot, the association shall make available during reasonable hours
all such records for duplication. The documents, information and
records described in subsections (1) and (3) of this section and
all other records of the association shall be located within this
state. - }
   { +  (b) Records kept by or on behalf of the association may
be withheld from examination and duplication to the extent the
records concern:
  (A) Personnel matters relating to a specific identified person
or a person's medical records;
  (B) Contracts, leases and other business transactions to
purchase or provide goods or services, currently under
negotiation;
  (C) Pending or probable litigation. As used in this
subparagraph, 'probable litigation' means those instances when
there has been a specific threat of litigation from a party or
the legal counsel of a party;
  (D) Matters involving state or local administrative or other
proceedings before a government body for enforcement of the
declaration, bylaws or other governing document or rules and
regulations promulgated pursuant thereto;
  (E) Communications with legal counsel that relate to matters
specified in subparagraphs (A) to (D) of this paragraph;
  (F) Disclosure of information in violation of law;
  (G) Documents, correspondence or management or board reports
compiled for or on behalf of the association or the board of
directors by its agents or committees for consideration by the
board of directors in executive session held in accordance with
ORS 94.640 (7);
  (H) Documents, correspondence or other matters considered by
the board of directors in executive session held in accordance
with ORS 94.640 (7); and
  (I) Files of individual owners, other than those of a
requesting owner or requesting mortgagee of an owner, including
any individual owner's file kept by or on behalf of the
association.
  (6) + } The association shall maintain a copy, suitable for the
purpose of duplication, of the following:
  (a) The declaration  { - , - }   { + and + } bylaws,
 { + including any amendments or supplements in effect, recorded
plat, if feasible, and + } association rules and regulations
 { - and any amendments or supplements to them - }  { +
currently in effect + }.
  (b) The most recent financial statement prepared pursuant to
subsection (3) of this section.
  (c) The current operating budget of the association.
   { +  (d) Reserve fund plan, if any, consisting of a plan of
contributions from regular and adequate assessments, adjusted by
estimated inflation and interest earned on reserve funds,
sufficient to meet a 30-year schedule for maintenance, repair and
replacement.
  (e) Architectural standards and guidelines, if any. + }
    { - (6) Upon written request of a prospective purchaser, the
association shall make available for examination and duplication
during reasonable hours the documents and information specified
in subsection (5) of this section. - }
   { +  (7) The association, within 10 days after receipt of a
written request by an owner, shall furnish the information
necessary to enable the owner to comply with ORS 105.465 or
105.475. + }
    { - (7) - }   { + (8) + } The   { - association may
charge - }  { +  board of directors, by resolution, may adopt
reasonable rules governing the frequency, time, location, notice
and manner of examination and duplication of association records
and the imposition of + } a reasonable fee for furnishing copies
of any documents, information or records described in this
section. The fee may include reasonable personnel costs for
furnishing the documents, information or records.
  SECTION 15. ORS 94.704 is amended to read:
  94.704. (1) Subject to   { - subsection - }
 { + subsections + } (2)  { + and (3) + } of this section, the
declarant of a planned community shall pay all common expenses of
the planned community until the individual lots subject to
assessment are assessed for common expenses.
   { +  (2) Except as required under subsection (3) of this
section, the declaration or bylaws may provide that lots owned by
the declarant or any other person are not subject to assessment
until the earlier of:
  (a) The issuance of a certificate of occupancy for the lot by
the local governing body; or
  (b) The turnover meeting is held in accordance with ORS 94.616
or the owners otherwise assume responsibility for administration
of the association. + }
    { - (2) - }   { + (3) + } The declarant may defer payment of
accrued assessments for reserves required under ORS 94.595 for a
lot until the date the lot is conveyed. However, the declarant
may not defer payment of accrued assessments for reserves:
  (a) Beyond the date of the turnover meeting provided for in the
bylaws in accordance with ORS 94.635 (3); or
  (b) If a turnover meeting is not held, the date the owners
assume administrative control of the association.
    { - (3) - }   { + (4) + } Failure of the declarant to deposit
the balance due within 30 days after the due date constitutes a
violation of ORS 94.777.
    { - (4) - }   { + (5) + } The books and records of the
association shall reflect the amount the declarant owes for all
reserve account assessments.
    { - (5)(a) - }   { + (6)(a) + } Except for assessments under
subsections
  { - (6), - }  (7) { + , + }   { - and - }  (8)  { + and (9) + }
of this section, the board of directors shall assess all common
expenses against all the lots that are subject to assessment
according to the allocations stated in the declaration.
  (b) Any assessment or any installment of the assessment past
due shall bear interest at the rate established by resolution of
the board of directors.
  (c) Nothing in this section prohibits the board from making
compromises on overdue assessments if the compromise benefits the
association.
    { - (6) - }   { + (7) + } Any common expense or any part of a
common expense benefiting fewer than all of the lots may be
assessed exclusively against the lots or units benefited.
    { - (7) - }   { + (8) + }  { + Unless otherwise provided in
the declaration or bylaws, + } assessments to pay a judgment
against the association may be made only against the lots
 { - existing in the planned community at the time the judgment
was entered and only - }  in proportion to their common expense
liabilities.
    { - (8) - }   { + (9) + } If the board of directors
determines that any common expense is the fault of any owner, the
homeowners association may assess the expense exclusively against
the lot of the owner.
    { - (9) - }   { + (10) + } If the homeowners association
reallocates common expense liabilities, any common expense
assessment and any installment of the assessment not yet due
shall be recalculated according to the reallocated common expense
liabilities.
    { - (10)(a) - }   { + (11)(a) + } A lot owner may not claim
exemption from liability for contribution toward the common
expenses by waiving the use or enjoyment of any of the common
property or by abandoning the owner's lot.
  (b) An owner may not claim to offset an assessment for failure
of the association to perform the association's obligations.
    { - (11)(a) - }   { + (12)(a) + } During any period of
declarant control, any special assessment for capital
improvements or additions must be approved by not less than 50
percent of the voting rights, or such greater percentage as may
be specified in the declaration, without regard to any weighted
right or special voting right in favor of the declarant.
  (b) Nothing in this subsection is intended to prohibit a
declarant from reserving a special declarant right to approve any
such assessment.
  SECTION 16. ORS 94.709 is amended to read:
  94.709. (1) Whenever a homeowners association levies any
assessment against a lot, the association  { - , upon complying
with subsection (2) of this section, - }  shall have a lien upon
the individual lot for any unpaid assessments   { - and interest
as provided in subsection (2)(b) of this section - }  { +  from
the time the assessment is due. The lien includes interest, late
charges or other amounts imposed under the declaration or bylaws
or other recorded governing document + }. The lien   { - shall
be - }   { + is + } prior to a homestead exemption and all other
liens or encumbrances upon the lot except:
  (a) Tax and assessment liens; and
  (b) A first mortgage or trust deed of record { +  recorded
prior to the date the assessment is due + }.
    { - (2)(a) An association claiming a lien under subsection
(1) of this section shall file in the county in which the lot or
some part thereof is located a claim containing: - }
   { +  (2)(a) Recording of the declaration constitutes record
notice and perfection of the lien for assessments. No further
recording of a claim of lien for assessment under this section is
required to perfect the association's lien. However, the
association may record a notice of claim of lien for assessments
under this section in the real property records of the county in
which a lot is located. The claim of lien shall contain: + }
  (A) A true statement of the amount due for the unpaid
assessments after deducting all just credits and offsets;
  (B) The name of the owner of the lot, or reputed owner, if
known;
  (C) The name of the association; and
  (D) The description of the lot as provided in ORS 93.600.
  (b) When a claim has been   { - filed and - }  recorded
pursuant to this subsection and the owner of the lot subject to
the claim thereafter fails to pay any assessment chargeable to
such lot, then so long as the original or any subsequent unpaid
assessment remains unpaid, such claim shall automatically
accumulate the subsequent unpaid assessments and interest thereon
without the necessity of further   { - filings - }
 { + recording + } under this section.
  (3) { + (a) + } The claim shall be verified by the oath of some
person having knowledge of the facts and shall be recorded by the
county recording officer. The record shall be indexed as other
liens are required by law to be indexed.
   { +  (b) The board of directors shall cause a copy of a claim
of lien recorded under this section to be mailed to the mailing
address of the affected lot or to the mailing address designated
by the owner in writing to the association not later than 10 days
after the recording of the claim of lien. + }
  (4) { + (a) + } The proceedings to foreclose liens created by
this section shall conform as nearly as possible to the
proceedings to foreclose liens created by ORS 87.010, except that
notwithstanding ORS 87.055, a lien may be continued in force for
a period of time not to exceed six years from the date the
 { - claim is filed and recorded under subsections (2) and (3) of
this section - }  { +  assessment was due + }. For the purpose of
determining the date the   { - claim is filed - }
 { + assessment is due + } in those cases when subsequent unpaid
assessments have accumulated under   { - the - }   { + a + }
claim  { + recorded + } as provided in subsection (2)(b) of this
section, the  { + assessment and + } claim regarding each unpaid
assessment shall be deemed to have been   { - filed - }
 { + levied + } at the time   { - such - }   { + the + } unpaid
assessment became due.
   { +  (b) + } The lien may be enforced by the board of
directors acting on behalf of the association.
   { +  (c) Prior to initiating a proceeding to foreclose a lien,
an owner must be given at least 30 days' written notice of the
intent of the association to initiate a proceeding to foreclose
the lien.  The notice must be mailed to the address of the
affected lot or to the mailing address designated by the owner in
writing to the association.
  (d) + } An action to recover a money judgment for unpaid
assessments may be maintained without foreclosing or waiving the
lien securing the claim for unpaid assessments.
  (5) Unless the declaration or bylaws provide otherwise, fees,
late charges, fines and interest imposed pursuant to ORS 94.630
(1)(L), (n) and (o) are enforceable as assessments under this
section.
  (6) This section does not prohibit an association from pursuing
an action to recover sums for which subsection (1) of this
section creates a lien or from taking a deed in lieu of
foreclosure in satisfaction of the lien.
  (7) An action to recover a money judgment for unpaid
 { - common expenses - }   { + assessments + } may be maintained
without foreclosing or waiving the lien   { - securing the claim
for common expenses - }  { +  for unpaid assessments + }.
However, recovery on the action operates to satisfy the lien, or
the portion thereof, for which recovery is made.
  SECTION 17. ORS 94.775 is amended to read:
  94.775.  { + (1) Except as provided in this section, + } no
judicial partition may be allowed of any property in a planned
community, nor may any person acquiring any interest in any
damaged or destroyed property in the planned community seek a
judicial partition unless the declarant or the homeowners
association has removed the property from the provisions of the
declaration.
   { +  (2) A suit for partition may be maintained under ORS
105.205, but the lot may not be partitioned if the partition of
the lot would constitute a violation of the declaration, bylaws
or other recorded governing document. ORS 105.245 shall govern in
the event of a violation.
  (3) In a suit to partition under ORS 105.205, the consent of
the board of directors of the association is required to evidence
that the partition does not violate the declaration, bylaws or
other recorded governing document. + }
  SECTION 18.  { + Section 19 of this 2003 Act is added to and
made a part of ORS chapter 100. + }
  SECTION 19.  { + (1) Upon compliance with subsection (2) of
this section, an association may record in the deed records of
the county in which the condominium is located a notice of
violation of the declaration or bylaws, including amendments or
supplements to the documents, or rules or regulation adopted
pursuant to the documents recorded in the deed records of the
county in which the property is located. The notice must be in
the form prescribed in this section.
  (2) Unless the declaration or bylaws provides otherwise, a
notice of violation may not be recorded unless:
  (a) The violation involves a condition or restriction of the
declaration or bylaws that affects an owner's unit or
improvements to the unit;
  (b) The owner has been given written notice of the alleged
violation in accordance with the declaration or bylaws and the
notice includes a statement of owner's right to request a
hearing, the right of the association to record a notice of
violation described in subsection (3) of this section and the
other specific requirements of this subsection;
  (c) The owner has been given an opportunity to have a hearing
before the board of directors or other entity responsible for
enforcement under the declaration or bylaws;
  (d) A hearing, if requested, has been held, a final
determination of violation in writing has been made and any
rights of appeal under the declaration or bylaws have expired;
and
  (e) The board of directors has adopted a resolution authorizing
the chairperson and secretary to execute a notice of violation
and cause the notice to be recorded under this section.
  (3) The notice of violation shall:
  (a) Be titled 'Notice of Violation' under this section and
include in the title a reference to the name of the condominium;
  (b) State the name of the association as identified in the
recorded declaration and bylaws and the current name of the
association, if different;
  (c) Include information identifying the recorded declaration
and bylaws and a reference to where the instruments are recorded;
  (d) State the name of the owner and a description of the
affected unit, as described for recordation in ORS 93.600;
  (e) State the violation and a reference to the relevant
provision of the declaration or bylaws that the owner is
violating;
  (f) Include information evidencing compliance with the
requirements of subsection (2) of this section; and
  (g) Be executed by the chairperson and secretary of the
association and acknowledged in the manner provided for
acknowledgment of instruments by the officers.
  (4) A notice may not include information for a purpose that is
not related to a violation described in subsection (2) of this
section.
  (5) An association may record an amendment to a notice of
violation or a notice of termination, which must be executed and
acknowledged by the chairperson and secretary of the association
and must include information identifying the prior recorded
notice and the information required under subsection (3)(b), (c)
and (d) of this section.
  (6) The county clerk may charge a fee for recording a notice of
violation and amendments to a notice of violation or a notice of
termination under this section according to the provisions of ORS
205.320 (4).
  (7) The board of directors shall cause a notice of termination
to be recorded promptly in the county deed records upon the
written request of the owner of the affected unit described in
the notice of violation in accordance with subsection (2)(d) of
this section and a determination that the violations stated in
the notice no longer exist or have otherwise been corrected to
the satisfaction of the board. + }
  SECTION 20. ORS 100.105 is amended to read:
  100.105. (1) A declaration shall contain:
  (a) A description of the property, including property on which
a unit or a limited common element is located, whether held in
fee simple, leasehold, easement or other interest or combination
thereof, that is being submitted to the condominium form of
ownership and that conforms to the description in the surveyor's
certificate provided under ORS 100.115 (2).
  (b) Subject to subsection (11) of this section, a statement of
the interest in the property being submitted to the condominium
form of ownership, whether fee simple, leasehold, easement or
other interest or combination thereof.
  (c) Subject to subsection (5) of this section, the name by
which the property shall be known and a general description of
each unit and the building or buildings, including the number of
stories and basements of each building, the total number of units
and the principal materials of which they are constructed.
  (d) The unit designation, a statement that the location of each
unit is shown on the plat, a description of the boundaries and
area in square feet of each unit and any other data necessary for
proper identification. The area of a unit shall be the same as
shown for that unit on the plat described in ORS 100.115 (2).
  (e) A description of the general common elements.
  (f) An allocation to each unit of an undivided interest in the
common elements in accordance with ORS 100.515 and the method
used to establish the allocation.
  (g) The designation of any limited common elements including:
  (A) A general statement of the nature of the limited common
element;
  (B) A statement of the unit to which the use of each limited
common element is reserved, provided the statement is not a
reference to an assignment of use specified on the plat; and
  (C) The allocation of use of any limited common element
appertaining to more than one unit.
  (h) The method of determining liability for common expenses and
right to common profits in accordance with ORS 100.530.
  (i) The voting rights allocated to each unit in accordance with
ORS 100.525 or in the case of condominium units committed as
property in a timeshare plan defined in ORS 94.803, the voting
rights allocated in the timeshare instrument.
  (j) A statement of the use, residential or otherwise, for which
the building or buildings and each of the units is intended.
  (k) A statement that the designated agent to receive service of
process in cases provided in ORS 100.550 (1) is named in the
Condominium Information Report which will be filed with the Real
Estate Agency in accordance with ORS 100.250 (1)(a).
  (L) The method of amending the declaration and the percentage
of voting rights required to approve an amendment of the
declaration in accordance with ORS 100.135.
  (m) A statement as to whether or not the association pursuant
to ORS 100.405 (5) and (8) has authority to grant leases,
easements, rights of way, licenses and other similar interests
affecting the general and limited common elements of the
condominium and consent to vacation of roadways within and
adjacent to the condominium.
  (n) If the condominium contains a floating structure described
in ORS 100.020 (3), a statement regarding the authority of the
board of directors of the association, subject to ORS 100.410, to
temporarily relocate the floating structure without a majority
vote of affected unit owners.
  (o) Any restrictions on alienation of units. Any such
restrictions created by documents other than the declaration may
 
be incorporated by reference in the declaration to the official
records of the county in which the property is located.
  (p) Any other details regarding the property that the person
executing the declaration considers desirable. However, if a
provision required to be in the bylaws under ORS 100.415 is
included in the declaration, the voting requirements for amending
the bylaws shall also govern the amendment of the provision in
the declaration.
  (2) In the event the declarant proposes to annex additional
property to the condominium under ORS 100.125, the declaration
shall also contain a general description of the plan of
development, including:
  (a) The maximum number of units to be included in the
condominium.
  (b) The date after which any right to annex additional property
will terminate.
  (c) A general description of the nature and proposed use of any
additional common elements which declarant proposes to annex to
the condominium, if such common elements might substantially
increase the proportionate amount of the common expenses payable
by existing unit owners.
  (d) A statement that the method used to establish the
allocation of undivided interest in the common elements, the
method used to determine liability for common expenses and right
to common profits and the method used to allocate voting rights
for each unit annexed shall be as stated in the declaration in
accordance with subsection (1)(f), (h) and (i) of this section.
  (e) Such other information as the Real Estate Commissioner
shall require in order to carry out the purposes of ORS 100.015,
100.635 to 100.730 and 100.740 to 100.910.
  (3) Except where expressly prohibited by the declaration and
subject to the requirements of ORS 100.135   { - (1) - }  { +
(2) + } and subsections (9) and (10) of this section:
  (a) Not later than two years following the termination dates
specified in subsections (2)(b) and (7)(d) of this section, such
termination dates may be extended for a period not exceeding two
years; and
  (b) The general description under subsection (2)(c) of this
section and the information included in the declaration in
accordance with subsection (7)(c), (g) and (h) of this section
may be changed by an amendment to the declaration.
  (4) The information included in the declaration in accordance
with subsection (2)(a) and (d) of this section and subsection
(7)(a), (b), (e), (f) and (k) of this section may not be changed
unless all owners agree to the change and record an amendment to
the declaration in accordance with this chapter.
  (5) The name of the property shall include the word '
condominium' or 'condominiums' or the words 'a condominium. '
  (6) A condominium may not bear a name which is the same as or
deceptively similar to the name of any other condominium located
in the same county.
  (7) If the condominium is a flexible condominium containing
variable property, the declaration shall also contain a general
description of the plan of development, including:
  (a) A statement that the rights provided for under ORS 100.150
(1) are being reserved.
  (b) A statement:
  (A) Of any limitations on rights reserved under ORS 100.150
(1), including whether the consent of any unit owner shall be
required, and if so, a statement of the method by which the
consent shall be ascertained; or
  (B) That there are no limitations on rights reserved under ORS
100.150 (1).
  (c) A statement of the total number of tracts of variable
property within the condominium, including:
 
  (A) A designation of each tract as withdrawable or
nonwithdrawable variable property;
  (B) Identification of each variable tract by a label in
accordance with ORS 100.115 (2)(i);
  (C) A statement of the method of labeling each tract depicted
on the plat in accordance with ORS 100.115 (2)(i); and
  (D) A statement of the total number of tracts of each type of
variable property.
  (d) The termination date, which is the date or time period
after which any right reserved under ORS 100.150 (1) will
terminate, and a statement of the circumstances, if any, that
will terminate any right on or before the date or time period
specified. The date or time period may not exceed seven years
from the recording of the conveyance of the first unit in the
condominium to a person other than the declarant. Recording shall
be in the county in which the property is located.
  (e) The maximum number of units that may be created.
  (f) A statement that the method used to establish the
allocations of undivided interest in the common elements, the
method used to determine liability for common expenses and right
to common profits and the method used to allocate voting rights
as additional units are created shall be the same as stated in
the declaration in accordance with subsection (1)(f), (h) and (i)
of this section.
  (g) A general description of all existing improvements and the
nature and proposed use of any improvements that may be made on
variable property if the improvements might substantially
increase the proportionate amount of the common expenses payable
by existing unit owners.
  (h) A statement of whether or not the declarant reserves the
right to create limited common elements within any variable
property, and if so, a general description of the types that may
be created.
  (i) A statement that the plat shows the location and dimensions
of all withdrawable variable property that is labeled '
WITHDRAWABLE VARIABLE PROPERTY.  '
  (j) A statement that if by the termination date all or a
portion of the withdrawable variable property has not been
withdrawn or reclassified, the withdrawable property shall
automatically be withdrawn from the condominium as of the
termination date.
  (k) A statement of the rights of the association under ORS
100.155 (2).
  (L) A statement of whether or not all or any portion of the
variable property may not be withdrawn from the condominium and,
if so, with respect to the nonwithdrawable variable property:
  (A) A statement that the plat shows the location and dimensions
of all nonwithdrawable property that is labeled ' NONWITHDRAWABLE
VARIABLE PROPERTY.  '
  (B) A description of all improvements that may be made and a
statement of the intended use of each improvement.
  (C) A statement that, if by the termination date all or a
portion of the variable property designated as 'nonwithdrawable
variable property' has not been reclassified, the property shall
automatically be reclassified as of the termination date as a
general common element of the condominium and any interest in
such property held for security purposes shall be automatically
extinguished by such classification.
  (D) A statement of the rights of the association under ORS
100.155 (3).
  (m) A statement by the local governing body or appropriate
department thereof that the withdrawal of any variable property
designated as 'withdrawable variable property' in the declaration
in accordance with paragraph (L) of this subsection, will not
violate any applicable planning or zoning regulation or
 
ordinance. The statement may be attached as an exhibit to the
declaration.
  (8) The plan of development for any variable property included
in the declaration or any supplemental declaration of any stage
in accordance with subsection (7) of this section shall be
subject to any plan of development included in the declaration in
accordance with subsection (2) of this section, except that the
time limitation specified in subsection (7)(d) of this section
shall govern any right reserved under ORS 100.150 (1) with
respect to any variable property.
  (9) The information included in the declaration in accordance
with subsection (7)(j), (k) and (m) of this section may not be
deleted by amendment.
  (10) Approval by the unit owners shall not be required to
redesignate variable property as 'nonwithdrawable variable
property' by supplemental declaration or amendment if such
redesignation is required by the local governing body or
appropriate department thereof to comply with any planning or
zoning regulation or ordinance. If as a result of such
redesignation the information required to be included in the
supplemental declaration or an amendment under subsection
(7)(L)(B) of this section is inconsistent with the information
included in the declaration or supplemental declaration in
accordance with subsection (7)(g) of this section, an amendment
to the declaration approved by at least 75 percent of owners
shall be required.
  (11) The statement of an interest in property other than fee
simple submitted to the condominium form of ownership and any
easements, rights or appurtenances belonging to property
submitted to the condominium form of ownership, whether leasehold
or fee simple, shall include:
  (a) A reference to the recording index numbers and date of
recording of the instrument creating the interest; or
  (b) A reference to the law, administrative rule, ordinance or
regulation that creates the interest if the interest is created
under law, administrative rule, ordinance or regulation and not
recorded in the office of the recording officer of the county in
which the property is located.
  SECTION 21. ORS 100.115 is amended to read:
  100.115. (1) When a declaration or a supplemental declaration
under ORS 100.125 is made and approved as required, it shall,
upon the payment of the fees provided by law, be recorded by the
recording officer. The fact of recording and the date thereof
shall be entered thereon. At the time of recording the
declaration or supplemental declaration, the person offering it
for record shall also file an exact copy, certified by the
recording officer to be a true copy thereof, with the county
assessor.
  (2) A plat of the land described in the declaration or a
supplemental plat described in a supplemental declaration,
complying with ORS 92.050, 92.060 (1) and (2), 92.080 and 92.120,
shall be recorded simultaneously with the declaration or
supplemental declaration. Upon request, the person offering the
plat or supplemental plat for recording shall also file an exact
copy, certified by the surveyor who made the plat to be an exact
copy of the plat, with the county assessor and the county
surveyor. The exact copy shall be made on suitable drafting
material having the characteristics of strength, stability and
transparency required by the county surveyor. The plat or
supplemental plat, titled in accordance with subsection (4) of
this section, shall:
  (a) Show the location of:
  (A) All buildings and public roads. The location shall be
referenced to a point on the boundary of the property; and
  (B) For a condominium containing units described in ORS 100.020
(3)(b)(C) or (D), the moorage space or floating structure.  The
location shall be referenced to a point on the boundary of the
upland property regardless of a change in the location resulting
from a fluctuation in the water level or flow.
  (b) Show the designation, location, dimensions and area in
square feet of each unit including:
  (A) For units in a building described in ORS 100.020 (3)(b)(A),
the horizontal and vertical boundaries of each unit and the
common elements to which each unit has access. The vertical
boundaries shall be referenced to a known benchmark elevation or
other reference point as approved by the city or county surveyor;
  (B) For a space described in ORS 100.020 (3)(b)(B), the
horizontal boundaries of each unit and the common elements to
which each unit has access. If the space is located within a
structure, the vertical boundaries also shall be shown and
referenced to a known benchmark elevation or other reference
point as approved by the city or county surveyor;
  (C) For a moorage space described in ORS 100.020 (3)(b)(C), the
horizontal boundaries of each unit and the common elements to
which each unit has access; and
  (D) For a floating structure described in ORS 100.020
(3)(b)(D), the horizontal and vertical boundaries of each unit
and the common elements to which each unit has access. The
vertical boundaries shall be referenced to an assumed elevation
of an identified point on the floating structure even though the
assumed elevation may change with the fluctuation of the water
level where the floating structure is moored.
  (c) Identify and show, to the extent feasible, the location and
dimensions of all limited common elements described in the
declaration. The plat may not include any statement indicating to
which unit the use of any noncontiguous limited common element is
reserved.
  (d) Include a statement, including signature and official seal,
of a registered architect, registered professional land surveyor
or registered professional engineer certifying that the plat
fully and accurately depicts the boundaries of the units of the
building and that construction of the units and buildings as
depicted on the plat has been completed, except that the
professional land surveyor who prepared the plat need not affix a
seal to the statement.
  (e) Include a surveyor's certificate, complying with ORS
92.070, that includes information in the declaration in
accordance with ORS 100.105 (1)(a) and a metes and bounds
description or other description approved by the city or county
surveyor.
  (f) Include a statement by the declarant that the property and
improvements described and depicted on the plat are subject to
the provisions of ORS 100.005 to 100.625.
  (g) Include such signatures of approval as may be required by
local ordinance or regulation.
  (h) Include any other information or data not inconsistent with
the declaration that the declarant desires to include.
  (i) If the condominium is a flexible condominium, show the
location and dimensions of all variable property identified in
the declaration and label the variable property as 'WITHDRAWABLE
VARIABLE PROPERTY' or 'NONWITHDRAWABLE VARIABLE PROPERTY,' with a
letter different from those designating a unit, building or other
tract of variable property. If there is more than one tract, each
tract shall be labeled in the same manner.
  (3) The supplemental plat required under ORS 100.150 (1) shall
be recorded simultaneously with the supplemental declaration.
Upon request, the person offering the supplemental plat for
recording shall also file an exact copy, certified by the
surveyor who made the plat to be an exact copy of the plat, with
the county assessor and the county surveyor. The exact copy shall
be made on suitable drafting material having the characteristics
of strength, stability and transparency required by the county
surveyor. The supplemental plat, titled in accordance with
subsection (4) of this section, shall:
  (a) Comply with ORS 92.050, 92.060 (1), (2) and (4), 92.080,
92.120 and subsections (4) and (5) of this section.
  (b) If any property is withdrawn:
  (A) Show the resulting perimeter boundaries of the condominium
after the withdrawal; and
  (B) Show the information required under subsection (2)(i) of
this section as it relates to any remaining variable property.
  (c) If any property is reclassified, show the information
required under subsection (2)(a) to (d) of this section.
  (d) Include a 'Declarant's Statement' that the property
described on the supplemental plat is reclassified or withdrawn
from the condominium and that the condominium exists as described
and depicted on the plat.
  (e) Include a surveyor's affidavit complying with ORS 92.070.
  (4) The title of each supplemental plat described in ORS
100.120 shall include the complete name of the condominium,
followed by the additional language specified in this subsection
 { +  and the appropriate reference to the stage being annexed or
tract of variable property being reclassified + }. Each
supplemental plat for a condominium recorded on or after January
1, 2002, shall be numbered sequentially and shall:
  (a) If property is annexed under ORS 100.125, include the words
'Supplemental Plat No. ___: Annexation of Stage; or
  (b) If property is reclassified under ORS 100.150, include the
words 'Supplemental Plat No. ___: Reclassification of Variable
Property.
  (5) Before a plat or a supplemental plat may be recorded, it
must be approved by the city or county surveyor as provided in
ORS 92.100. Before approving the plat as required by this
section, the city or county surveyor shall:
  (a) Check the boundaries of the plat and units and take
measurements and make computations necessary to determine that
the plat complies with this section.
  (b) Determine that the name complies with ORS 100.105 (5) and
(6).
  (c) Determine that the following are consistent:
  (A) The designation and area in square feet of each unit shown
on the plat and the unit designations and areas contained in the
declaration in accordance with ORS 100.105 (1)(d);
  (B) Limited common elements identified on the plat and the
information contained in the declaration in accordance with ORS
100.105 (1)(g);
  (C) The description of the property in the surveyor's
certificate included on the plat and the description contained in
the declaration in accordance with ORS 100.105 (1)(a); and
  (D) For a flexible condominium, the variable property depicted
on the plat and the identification of the property contained in
the declaration in accordance with ORS 100.105 (7)(c).
  (6) The person offering the plat for approval shall:
  (a) Submit a copy of the proposed declaration and bylaws or
applicable supplemental declaration at the time the plat is
submitted; and
  (b) Submit the original or a copy of the executed declaration
and bylaws or the applicable supplemental declaration approved by
the commissioner if required by law prior to approval.
  (7) For performing the services described in subsection (5)(a)
to (c) of this section, the city surveyor or county surveyor
shall collect from the person offering the plat for approval a
fee of $150 plus $25 per building. The governing body of a city
or county may establish a higher fee by resolution or order.
  (8)(a) Whenever variable property is reclassified or withdrawn
as provided in ORS 100.155 (1) or (2) or property is removed as
provided in ORS 100.600 (2), the county surveyor shall, upon the
surveyor's copy of all previously recorded plats relating to the
variable property or property being removed and upon any copy
thereof certified by the county clerk, trace, shade or make other
appropriate marks or notations, including the date and the
surveyor's name or initials, with archival quality black ink in
such manner as to denote the reclassification, withdrawal or
removal. The recording index numbers and date of recording of the
supplemental declaration and plat or amendment and amended plat
shall also be referenced on the copy of each plat. The original
plat may not be changed or corrected after the plat is recorded.
  (b) For performing the activities described in this subsection,
the county clerk shall collect a fee set by the county governing
body. The county clerk shall also collect a fee set by the county
governing body to be paid to the county surveyor for services
provided under this subsection.
  (9) In addition to the provisions of subsection (10) of this
section, a plat, including any floor plans that are a part of the
plat, may be amended as provided in this subsection.
  (a)(A) Except as otherwise provided in ORS 100.600, a change to
the boundary of the property, a unit or a limited common element
or a change to the configuration of other information required to
be graphically depicted on the plat shall be made by a plat
entitled 'Plat Amendment' that shall reference in the title of
the amendment the recording information of the original plat and
any previous plat amendments.
  (B) The plat amendment shall comply with ORS 92.050, 92.060
(1), (2) and (4), 92.080 and 92.120 and shall include:
  (i) A graphic depiction of the change.
  (ii) For a change to the boundary of the property, a surveyor's
certificate, complying with ORS 92.070.
  (iii) For a change to a boundary of a unit or a limited common
element or a change to other information required to be
graphically depicted, the statement of a registered architect,
registered professional land surveyor or registered professional
engineer described in subsection (2)(d) of this section.
  (iv) A declaration by the chairperson and secretary on behalf
of the association of unit owners that the plat is being amended
pursuant to this subsection. Such declaration shall be executed
and acknowledged in the manner provided for acknowledgment of
deeds.
  (C) The plat amendment shall be accompanied by an amendment to
the declaration authorizing such plat amendment. The declaration
amendment shall be executed, approved and recorded in accordance
with ORS 100.110 and 100.135.
  (D) Before a plat amendment may be recorded, it must be
approved by the city or county surveyor as provided in ORS
92.100.  The surveyor shall approve the plat amendment if it
complies with the requirements of this subsection. The person
offering the plat amendment shall:
  (i) Submit a copy of the proposed amendment to the declaration
required under this paragraph when the plat amendment is
submitted; and
  (ii) Submit the original or a copy of the executed amendment to
the declaration approved by the commissioner if required by law
prior to approval of the plat amendment.
  (E) Upon request, the person offering the plat amendment for
recording shall also file an exact copy, certified by the
surveyor who made the plat to be an exact copy of the plat
amendment, with the county assessor and the county surveyor. The
exact copy shall be made on suitable drafting material having the
strength, stability and transparency required by the county
surveyor.
  (b)(A) A change to a restriction or other information not
required to be graphically depicted on the plat may be made by
amendment of the declaration without a plat amendment described
in paragraph (a) of this subsection. An amendment under this
paragraph shall include:
  (i) A reference to recording index numbers and date of
recording of the declaration, plat and any applicable
supplemental declarations, amendments, supplemental plats or plat
amendments.
  (ii) A description of the change to the plat.
  (iii) A statement that the amendment was approved in accordance
with the declaration and ORS 110.135.
  (B) The amendment shall be executed, approved and recorded in
accordance with ORS 100.110 and 100.135.
  (C) Before the amendment may be recorded, it must be approved
by the city or county surveyor as provided in ORS 92.100. The
surveyor shall approve the amendment if it complies with this
subsection. Such approval shall be evidenced by execution of the
amendment or by written approval attached thereto.
  (c)(A) Floor plans of a condominium for which a plat was not
required at the time of creation may be amended by an amendment
to the declaration. An amendment under this paragraph shall
include:
  (i) A reference to recording index numbers and date of
recording of the declaration and any applicable supplemental
declarations or amendments.
  (ii) A description of the change to the floor plans.
  (iii) A graphic depiction of any change to the boundaries of a
unit or common element and a statement by a registered architect,
registered professional land surveyor or registered professional
engineer certifying that such graphic depiction fully and
accurately depicts the boundaries of the unit or common element
as it currently exists.
  (B) The amendment shall be approved and recorded in accordance
with ORS 100.110 and 100.135 except that any change to the floor
plans need only comply with the requirements of the unit
ownership laws in effect at the time the floor plans were
initially recorded.
  (d) After recording of any declaration amendment or plat
amendment pursuant to this subsection, the county surveyor shall,
upon the surveyor's copy of all previously recorded plats
relating to the condominium and any copies filed under ORS 92.120
(3), make such appropriate marks or notations, including the date
and the surveyor's name or initials, with archival quality black
ink in such manner as to denote the changes. The recording index
numbers and date of recording of the declaration amendment and
any plat amendment shall also be referenced on the copy of each
plat. The original plat may not be changed or corrected after the
plat is recorded. For performing the services described in this
subsection, the county surveyor shall collect from the person
offering the plat amendment or declaration amendment for approval
a fee established by the county governing body.
  (10) The following may be amended by an affidavit of correction
in accordance with ORS 92.170:
  (a) A plat, whenever recorded.
  (b) Floor plans recorded prior to October 15, 1983.
  SECTION 22. ORS 100.130 is amended to read:
  100.130. (1) Subject to any limitations contained in the
declaration, the boundaries between adjoining units, including
any intervening common elements, may be relocated or eliminated
by an amendment to the declaration. The owners of the affected
units shall submit to the board of directors of the association a
proposed amendment which shall identify the units involved, state
any reallocations of common element interest, voting rights,
common expense liability and right to common profits and contain
words of conveyance. The board of directors shall approve the
amendment unless it determines within 45 days that the
reallocations are unreasonable or the relocation or elimination
will impair the structural integrity or mechanical systems of the
condominium or lessen the support of any portion of the
condominium.
  (2) The board of directors of the association may require the
owners of the affected units to submit an opinion of a registered
architect or registered professional engineer that the proposed
relocation or elimination will not impair the structural
integrity or mechanical systems of the condominium or lessen the
support of any portion of the condominium.
  (3) The board of directors of the association or any agent
appointed by the board of directors may supervise the work
necessary to effect the boundary relocation or elimination.
  (4) Any expenses incurred under subsections (2) and (3) of this
section shall be charged to the owners of the units requesting
the boundary relocation or elimination.
  (5) The amendment shall be executed by the owners and
mortgagees or trust deed beneficiaries of the affected units,
certified by the chairman and secretary of the association and
approved and recorded in accordance with ORS 100.135
 { - (1)(b) - }  { +  (2)(b) + }.
  (6) An amendment to the plat and any floor plans necessary to
show the altered boundaries between the adjoining units shall be
recorded in accordance with ORS 100.115.
  SECTION 23. ORS 100.135 is amended to read:
  100.135.  { + (1) Unless otherwise provided in the declaration,
an amendments to the declaration may be proposed by a majority of
the board of directors or by least 30 percent of the owners. + }
   { +  + }  { - (1) - }   { + (2) + } Except as otherwise
provided in ORS 100.005 to 100.625, an amendment of the
declaration is not effective unless:
  (a) The amendment is approved by the unit owners as provided in
this section and the Real Estate Commissioner and county assessor
according to ORS 100.110; and
  (b) The amendment, certified by the chairperson and secretary
of the association of unit owners as being adopted in accordance
with the declaration and the provisions of this section and
acknowledged in the manner provided for acknowledgment of deeds,
is recorded notwithstanding a provision in a declaration,
including a declaration recorded before January 1, 2002, that
requires amendments to be executed and acknowledged by all owners
approving the amendment.
    { - (2) - }   { + (3) + } Except as otherwise provided in ORS
100.105 or 100.130 or this section, the declaration may be
amended only with the approval of at least 75 percent of owners,
or such greater percentage as may be required by the declaration.
    { - (3) - }   { + (4) + } Unless the declaration requires a
greater percentage:
  (a) The declaration and plat may be amended to change a general
common element to a limited common element or change the boundary
of a limited common element with the approval of at least 75
percent of owners and approval of the owners of all units to
which the limited common element appertains.
  (b) The declaration may be amended to change a limited common
element, or portion thereof, to a general common element with the
approval of the owners of all units to which the limited common
element appertains and the board of directors.
    { - (4)(a) - }   { + (5)(a) + } Except as otherwise provided
in ORS 100.120, 100.130, 100.515, 100.600, 100.605 and 100.625
and paragraph (b) of this subsection or other provisions of the
Oregon Condominium Act, an amendment that changes the boundary of
the property or a unit { + , including changing a portion of
common elements to a unit, + } shall be approved by all unit
owners. Such amendment shall constitute a conveyance and shall
include words of conveyance. In addition to the certification
required under subsection   { - (1)(b) - }  { +  (2)(b) + } of
this section, an amendment to the boundary of a unit shall also
be executed by the owners of all affected units.
 
 
  (b) An amendment that adds property owned by the association to
the condominium as a common element shall constitute a conveyance
and shall:
  (A) Be approved by at least 75 percent of owners;
  (B) Contain words of conveyance;
  (C) Be executed by the chairperson and secretary of the
association on behalf of the unit owners and be certified in
accordance with subsection   { - (1)(b) - }   { + (2)(b) + } of
this section; and
  (D) Be accompanied by a plat amendment in accordance with ORS
100.115.
  (c) Nothing in paragraph (b) of this subsection is intended to
require property acquired or held by the association pursuant to
ORS 100.405 (4)(i) to be added to the condominium.
    { - (5) - }   { + (6) + } Except as otherwise provided in ORS
100.005 to 100.625, no amendment may change the allocation of
undivided interest in the common elements, method of determining
liability for common expenses, right to common profits or voting
rights of any unit unless such amendment has been approved by the
owners of the affected units.
    { - (6) - }   { + (7) + } The declaration may not be amended
to limit or diminish any right of a declarant reserved under ORS
100.105 (2) or (7) or any other special declarant right without
the consent of the declarant. However, the declarant may waive
the declarant's right of consent.
    { - (7) - }   { + (8) + } Nothing in this section shall
affect any other approval that may be required by the
declaration, bylaws or other instrument.
   { +  (9) During a period of declarant control reserved under
ORS 100.200, voting on an amendment under this section must be
without regard to any weighted vote or other special voting
allocation reserved by the declarant unless the declaration
provides that the declarant has the right to exercise the voting
rights with respect to specifically described amendments. Nothing
in this subsection prohibits a declarant from reserving the right
that declarant's consent shall be required for an amendment
during a period of declarant control reserved in the
declaration. + }
    { - (8) - }   { + (10) + } An amendment to a declaration or a
supplemental declaration shall be conclusively presumed to have
been regularly adopted in compliance with all applicable
procedures relating to such amendment unless an action is brought
within one year after the date such amendment was recorded or the
face of the recorded amendment indicates that the amendment
received the approval of fewer votes than are required for such
approval. However, nothing in this subsection shall prevent the
further amendment of an amended declaration or plat in accordance
with ORS 100.005 to 100.625.
   { +  (11)(a) The board of directors, by resolution, may cause
to be prepared and recorded a restated declaration to codify
individual amendments that have been adopted in accordance with
this section without the further approval of owners.
  (b) A declaration restated under this subsection must include
all previously adopted amendments in effect and may not include
any other changes except to correct scrivener's errors or to
conform format and style.
  (c) A declaration restated under this subsection must:
  (A) Include a statement that the board of directors has adopted
a resolution in accordance with paragraph (a) of this subsection
and is causing the declaration to be restated and recorded under
this subsection;
  (B) Include a reference to the recording index numbers and date
of recording of the initial declaration and all previously
recorded amendments in effect being codified;
  (C) Include a certification by the chairperson and secretary of
the association that the restated declaration includes all
previously adopted amendments in effect and no other changes,
except, if applicable, to correct scrivener's errors or to
conform format and style;
  (D) Be executed and acknowledged by the chairperson and
secretary of the association and recorded in the deed records of
each county in which the condominium is located; and
  (E) Be approved by the commissioner, county assessor and tax
collector in accordance with ORS 100.110 if the restated
declaration includes any amendment not previously approved in
accordance with ORS 100.110.
  (d) The board of directors shall cause a copy of the recorded
restated declaration, including the recording information, to be
filed with the commissioner. + }
  SECTION 24. ORS 100.175 is amended to read:
  100.175. (1) The declarant shall:
  (a) Conduct a reserve study described in subsection (3) of this
section; and
  (b) Establish a reserve account for replacement of those common
elements all or part of which will normally require replacement
in more than three and less than 30 years, for exterior painting
if the common elements include exterior painted surfaces, and for
such other items as may be required by the declaration or bylaws.
The reserve account need not include:
  (A) Items that could reasonably be funded from operating
assessments; or
  (B) A reserve for limited common elements for which maintenance
and replacement are the responsibility of one or more unit owners
under the provisions of the declaration or bylaws.
  (2)(a) The reserve account must be funded by assessments
against the individual units for the purposes for which the
reserve account is being established.
  (b) The assessment under this subsection will accrue from the
time of the conveyance of the first individual unit assessed as
provided in ORS 100.530.
  (3)(a) The reserve account shall be established in the name of
the association of unit owners that will be responsible for
administering the account and for making periodic payments into
the account.
  (b) The reserve portion of the initial assessment determined by
the declarant shall be based on the following:
  (A) The reserve study described in paragraph (c) of this
subsection;
  (B) In the case of a conversion condominium, the statement
described in ORS 100.655 (1)(g); or
  (C) Other reliable information.
  (c) The board of directors of the association annually shall
conduct a reserve study or review and update an existing study to
determine the reserve account requirements and may:
  (A) Adjust the amount of payments in accordance with the study
or review; and
  (B) Provide for other reserve items that the board of
directors, in its discretion, may deem appropriate.
  (d) The reserve study shall include:
  (A) Identification of all items for which reserves are to be
established;
  (B) The estimated remaining useful life of each item as of the
date of the reserve study;
  (C) An estimated cost of maintenance, repair or replacement of
each item at the end of its useful life; and
  (D) A 30-year plan with regular and adequate contributions,
adjusted by estimated inflation and interest earned on reserves,
to meet the maintenance, repair and replacement schedule.
  (4)(a) If the declaration or bylaws require a reserve account,
the reserve study requirements of subsection (3) of this section
first apply to the association of a condominium recorded prior to
October 23, 1999:
  (A) Upon adoption of a resolution by the board of directors in
accordance with the bylaws providing that the requirements of
subsection (3) of this section apply to the association; or
  (B) Upon submission to the board of directors of a petition
signed by a majority of unit owners mandating that the
requirements of subsection (3) of this section apply to the
association.
  (b) The reserve study shall be completed within one year of the
date of adoption of the resolution or submission of the petition
to the board of directors.
  (5)(a) Except as provided in paragraph (b) of this subsection,
the reserve account is to be used only for the purposes for which
reserves have been established and is to be kept separate from
other funds.
  (b) After the individual unit owners have assumed
administrative responsibility for the association under ORS
100.210,  { + if the board of directors has adopted a resolution,
which may be an annual continuing resolution, authorizing the
borrowing of funds, + } the board of directors may borrow funds
from the reserve account to meet high seasonal demands on the
regular operating funds or to meet unexpected increases in
expenses   { - which will later be paid from assessments if the
board of directors has adopted a resolution, which may be an
annual continuing resolution, authorizing the borrowing of
funds - } . Not later than the adoption of the budget for the
following year, the board of directors shall adopt by resolution
a written payment plan providing for repayment of the borrowed
funds within a reasonable period.
  (6) Restrictions on the use of the reserve account do not
prohibit its prudent investment subject to any constraints on
investment of association funds imposed by the declaration,
bylaws or rules of the association of unit owners.
  (7) Assessments paid into the reserve account are the property
of the association of unit owners and are not refundable to
sellers of units.
  (8) In addition to the authority of the board of directors
under subsection (3)(c) of this section, following turnover, the
association may:
  (a) On an annual basis, elect not to fund the reserve account
described in subsection (1) of this section by unanimous vote of
the owners; or
  (b) Elect to reduce or increase future assessments for the
reserve account described in subsection (1) of this section by an
affirmative vote of at least 75 percent of the owners.
  SECTION 25. ORS 100.405 is amended to read:
  100.405. (1)(a) An association of unit owners shall be
organized to serve as a means through which the unit owners may
take action with regard to the administration, management and
operation of the condominium. The association shall be organized
as a corporation for profit or nonprofit corporation or as an
unincorporated association. If the association is incorporated,
the name of the association shall include the complete name of
the condominium.
  (b) Unless otherwise provided in the declaration or bylaws, an
unincorporated association may be incorporated if such action is
approved by a majority of unit owners in person, by written
ballot or by proxy at a meeting at which a quorum is present.
  (2) Membership in the association of unit owners shall be
limited to unit owners.
  (3) The affairs of the association shall be governed by a board
of directors as provided for in the bylaws adopted under ORS
100.410.
  (4) Subject to the provisions of the condominium's declaration
and bylaws, and whether or not the association is unincorporated,
the association may:
  (a) Adopt and amend bylaws and rules and regulations;
  (b) Adopt and amend budgets for revenues, expenditures and
reserves and levy and collect assessments for common expenses
from unit owners;
  (c) Hire and terminate managing agents and other employees,
agents and independent contractors;
  (d) Defend against any claims, proceedings or actions brought
against it;
  (e) Subject to subsection (11) of this section, initiate or
intervene in litigation or administrative proceedings in its own
name, and without joining the individual unit owners, in the
following:
  (A) Matters relating to the collection of assessments and the
enforcement of governing documents;
  (B) Matters arising out of contracts to which the association
is a party;
  (C) Actions seeking equitable or other nonmonetary relief
regarding matters that affect the common interests of the unit
owners, including but not limited to the abatement of nuisance;
  (D) Matters relating to or affecting common elements, including
but not limited to actions for damage, destruction, impairment or
loss of use of any common element;
  (E) Matters relating to or affecting the units or interests of
unit owners including but not limited to damage, destruction,
impairment or loss of use of a unit or portion thereof, if:
  (i) Resulting from a nuisance or a defect in or damage to a
common element; or
  (ii) Required to facilitate repair to any common element; and
  (F) Any other matter to which the association has standing
under law or pursuant to the declaration, bylaws or any articles
of incorporation;
  (f) Make contracts and incur liabilities;
  (g) Regulate the use, maintenance, repair, replacement and
modification of common elements;
  (h) Cause additional improvement to be made as a part of the
common elements;
  (i) Acquire by purchase, lease, devise, gift or voluntary grant
real or personal property or any interest therein and take, hold,
possess and dispose of real or personal property or any interest
therein;
  (j) Impose and receive any payments, fees or charges for the
use, rental or operation of the common elements;
  (k) Impose charges for late payments of assessments, attorney
fees for collection of assessments and, after giving
 { + written + } notice and an opportunity to be heard, levy
reasonable fines for violations of the declaration, bylaws and
rules and regulations of the association if the charge imposed or
fine levied is based on a schedule contained in the declaration
or bylaws, or an amendment to either that is delivered to each
unit, mailed to the mailing address of each unit or mailed to the
mailing addresses designated in writing by the owners, or based
on a resolution adopted by the board of directors or the
association that is delivered to each unit, mailed to the mailing
address of each unit or mailed to the mailing addresses
designated by the owners in writing;
  (L) Adopt rules regarding the termination of utility services
paid for out of assessments of the association and access to and
use of recreational and service facilities available to unit
owners and, after giving written notice and an opportunity to be
heard, terminate the rights of any owners to receive such
benefits or services until the correction of any violation
covered by such rule has occurred;
  (m) Impose reasonable charges for the preparation and
recordation of amendments to the declaration or statements of
assessments;
  (n) Assign its right to future income, including the right to
receive common expense assessments;
  (o) Provide for the indemnification of its officers and
executive board, as may be limited by ORS 61.218 (3)(d) (1987
Replacement Part), and maintain directors' and officers'
liability insurance;
  (p) Exercise any other powers conferred by the declaration or
bylaws;
  (q) Exercise all other powers that may be exercised in this
state by any such association; and
  (r) Exercise any other powers determined by the association to
be necessary and proper for the governance and operation of the
association.
  (5) Subject to subsection (6) of this section, unless expressly
limited or prohibited by the declaration, the association has the
authority to grant, execute, acknowledge, deliver and record on
behalf of the unit owners leases, easements, rights of way,
licenses and other similar interests affecting the general common
elements and consent to vacation of roadways within and adjacent
to the condominium.
  (6) { + (a)(A) Except as provided in subparagraph (B) of this
paragraph, + } the granting of a lease, easement, right of way,
license or other similar interest   { - in excess of two years or
consent - }  pursuant to subsection (5) of this section shall be
first approved by at least 75 percent of owners.
   { +  (B) + } Unless the declaration otherwise
provides { + : + }   { - , a grant of any such interest affecting
the general common elements for a term of two years or less shall
not be considered the granting of an interest for which approval
by the unit owners is required under this subsection. - }
   { +  (i) The granting of a lease, easement, right of way,
license or other similar interest affecting the general common
elements for a term of two years or less shall require the
approval of a majority of the board of directors.
  (ii) The granting of a lease, easement, right of way, license
or other similar interest affecting the general common elements
for a term of more than two years to a municipality or other
governmental body or utilities company or communication company
for underground installation and maintenance of power, gas,
electric, water and other utility and communication lines and
services shall require the approval of a majority of the board of
directors.
  (iii) The granting of a lease, easement, license or other
similar interest to an owner for the exclusive use of a part of
the general common elements to which the owner's unit provides
primary access shall require the approval of a majority of the
board of directors.
  (b) Unless the declaration otherwise provides, the consent to
vacation of roadways within and adjacent to the condominium shall
be first approved by at least a majority of unit owners present
voting in person or by proxy at a duly constituted meeting of the
association called for such purpose. + }
  (7) The instrument granting an interest or consent pursuant to
subsection (5) of this section shall be executed by the
chairperson and secretary of the association and acknowledged in
the manner provided for acknowledgment of such instruments by
such officers and shall state that such grant or consent was
approved, if appropriate, by at least   { - 75 - }   { + the + }
percent of owners { +  required under subsection (6) of this
section + }.
  (8) Unless expressly prohibited by the declaration, any action
permitted under subsections (5) and (6) of this section regarding
a general common element may be taken with respect to any limited
common element, provided that the owner of the unit to which the
use of the limited common element is reserved and the holder of
any mortgage or trust deed affecting the unit consent to the
action and also execute an instrument as provided under
subsection (7) of this section.
  (9) Except as otherwise provided in the association's
declaration or bylaws, the board of directors of the association
may modify, close, remove, eliminate or discontinue the use of a
general common element facility or improvement or portion of the
common element landscaping, regardless of whether such facility,
improvement or landscaping is mentioned in the declaration or
shown on the plat provided that:
  (a) Nothing in this subsection shall be construed as limiting
the authority of the board of directors, in its discretion, to
seek approval of such modification, closure, removal, elimination
or discontinuance by the unit owners; and
  (b) Modification, closure, removal, elimination or
discontinuance other than on a temporary basis of any swimming
pool, spa or recreation or community building must be approved by
at least a majority of the unit owners voting on such matter at a
meeting or by written ballot held in accordance with the
declaration, bylaws or ORS 100.425.
  (10)(a) A permit or authorization issued by the board of
directors pursuant to authority granted to the board under law,
the declaration or the bylaws, may be recorded in the deed
records of the county where the condominium is located. An
instrument recorded under this subsection shall:
  (A) Include the name of the condominium and a reference to
where the declaration and any applicable supplemental
declarations are recorded;
  (B) Identify, by the designations stated in the declaration or
applicable supplemental declaration, all affected units and
common elements;
  (C) Include such other information and signatures as may be
required by law, under the declaration or bylaws or as the board
of directors may desire; and
  (D) Be executed by the chairperson and secretary of the
association and acknowledged in the manner provided for
acknowledgment of such instruments by the officers.
  (b) The board of directors may record an amendment,
modification, termination or other instrument relating to the
permit or authorization described in this subsection. Any such
instrument shall include a reference to the location of the
recorded instrument and be executed by the chairperson and
secretary of the association and acknowledged in the manner
provided for acknowledgment of such instruments.
  (11)(a) Subject to paragraph (f) of this subsection, before
initiating litigation or an administrative proceeding in which
the association and an owner have an adversarial relationship,
the party that intends to initiate litigation or an
administrative proceeding shall offer to use any dispute
resolution program available within the county in which the
condominium is located that is in substantial compliance with the
standards and guidelines adopted under ORS 36.175. The written
offer must be hand-delivered or mailed by certified mail, return
receipt requested, to the address, contained in the records of
the association, for the other party.
  (b) If the party receiving the offer does not accept the offer
within 10 days after receipt by written notice hand-delivered or
mailed by certified mail, return receipt requested, to the
address, contained in the records of the association, for the
other party, the initiating party may commence the litigation or
the administrative proceeding. The notice of acceptance of the
offer to participate in the program must contain the name,
address and telephone number of the body administering the
dispute resolution program.
  (c) If a qualified dispute resolution program exists within the
county in which the condominium is located and an offer to use
the program is not made as required under paragraph (a) of this
subsection, litigation or an administrative proceeding may be
stayed for 30 days upon a motion of the noninitiating party. If
the litigation or administrative action is stayed under this
paragraph, both parties shall participate in the dispute
resolution process.
  (d) Unless a stay has been granted under paragraph (c) of this
subsection, if the dispute resolution process is not completed
within 30 days after receipt of the initial offer, the initiating
party may commence litigation or an administrative proceeding
without regard to whether the dispute resolution is completed.
  (e) Once made, the decision of the court or administrative body
arising from litigation or an administrative proceeding may not
be set aside on the grounds that an offer to use a dispute
resolution program was not made.
  (f) The requirements of this subsection do not apply to
circumstances in which irreparable harm to a party will occur due
to delay or to litigation or an administrative proceeding
initiated to collect assessments, other than assessments
attributable to fines.
  SECTION 26. ORS 100.407 is amended to read:
  100.407. (1) The association of unit owners shall hold at least
one meeting of the owners each calendar year.
  (2) { + (a) + } Special meetings of the association may be
called by the chairperson of the board of directors, a majority
of the board of directors or a percentage of owners specified in
the bylaws.  However, the bylaws may not require a percentage
greater than 50 percent or less than 10 percent of the owners for
the purpose of calling a meeting.
   { +  (b) If the bylaws do not specify a percentage of owners
that may call a special meeting, 30 percent or more of the owners
may call a special meeting, notice of which shall be given as
specified in this section. + }
  (3) { + (a) + } Not less than 10 nor more than 50 days before
any meeting called under this section, the secretary or other
officer of the association specified in the bylaws shall cause
notice to be hand delivered or mailed to the mailing address of
each unit or to the mailing address designated in writing by the
owner, and to all mortgagees that have requested such notice.
Mortgagees may designate a representative to attend a meeting
called under this section.
   { +  (b) + } The notice shall state the time and place of the
meeting and the items on the agenda, including the general nature
of any proposed amendment to the declaration or bylaws, any
budget changes or any proposal to remove a director or officer of
the association.
   { +  (c) Mortgagees may designate a representative to attend a
meeting called under this section. + }
  SECTION 27. ORS 100.410 is amended to read:
  100.410. (1) The declarant shall adopt on behalf of the
association the initial bylaws which shall govern the
administration of the condominium. The bylaws shall be recorded
simultaneously with the declaration as an exhibit or as a
separate instrument.
  (2) Unless otherwise provided in the declaration or bylaws,
amendments to the bylaws may be proposed by a majority of the
board of directors or by at least 30 percent of the owners.
  (3) Subject to subsections (4) and (5) of this section and ORS
100.415 (20), an amendment of the bylaws is not effective unless
 { + the amendment is:
  (a) + } Approved by at least a majority of the unit owners
 { - and until a copy of the amendment, - }  { + ; and
  (b) + } Certified by the chairperson and secretary of the
association of unit owners as being adopted in accordance with
the bylaws and the provisions of this section,   { - is - }
 { + acknowledged in the manner provided for acknowledgment of
deeds and + } recorded.
  (4) In condominiums which are exclusively residential:
 
  (a) The bylaws may not provide that greater than a majority is
required to amend the bylaws except for amendments relating to
age restrictions, pet restrictions, limitations on the number of
persons who may occupy units and limitations on the rental or
leasing of units.
  (b) An amendment relating to a matter specified in paragraph
(a) of this subsection is not effective unless approved by at
least 75 percent of the owners or a greater percentage specified
in the bylaws.
  (5) The bylaws may not be amended to limit or diminish any
special declarant right without the consent of the declarant.
However, the declarant may waive the declarant's right of
consent.
  (6) { + (a) + } For five years after  { + the + } recording
 { + of + } the initial bylaws, before any amended bylaws or
amendment to a bylaw may be recorded, it must be approved by the
Real Estate Commissioner. The commissioner shall approve such
amendment if the requirements of ORS 100.415 and this section
have been satisfied.
   { +  (b) The approval of the commissioner under paragraph (a)
of this subsection is not required for bylaws restated under
subsection (10) of this section unless the bylaws are restated
during the five year period after the recording of the initial
bylaws and the restated bylaws include an amendment not approved
by the commissioner. + }
  (7) Before the commissioner approves amended bylaws { + , + }
 { - or - }  an amendment to a bylaw  { + or restated bylaws + }
under this section, the person submitting the amended
bylaws { + , + }   { - or - }  amendment to a bylaw { +  or
restated bylaws + } shall pay to the commissioner the fee
provided by ORS 100.670.  { +
  (8) Notwithstanding a provision in the bylaws, including bylaws
adopted prior to the effective date of this 2003 Act, that
requires amendments to be executed or executed and acknowledged
by all owners approving the amendment, amendments to the bylaws
under this section are effective after approval by the owners if
only executed and certified on behalf of the association by the
chairperson and secretary in accordance with subsection (3)(b) of
this section.
  (9) An amendment to the bylaws must be conclusively presumed to
have been regularly adopted in compliance with all applicable
procedures relating to the amendment unless an action is brought
within one year after the effective date of the amendment or the
face of the amendment indicates that the amendment received the
approval of fewer votes than required for the approval. Nothing
in this subsection prevents the further amendment of an amended
bylaw.
  (10)(a) The board of directors, by resolution, may cause to be
prepared and recorded restated bylaws to codify individual
amendments that have been adopted in accordance with this section
without the further approval of owners.
  (b) Bylaws restated under this subsection shall include all
previously adopted amendments in effect and may not include any
other changes except to correct scrivener's errors or to conform
format and style.
  (c) Bylaws restated under this subsection shall:
  (A) Include a statement that the board of directors has adopted
resolution in accordance with paragraph (a) of this subsection
and is causing the bylaws to be restated and recorded under this
subsection;
  (B) Include a reference to the recording index numbers and date
of recording of the initial bylaws and all previously recorded
amendments in effect being codified;
  (C) Include a certification by the chairperson and secretary of
the association that the restated bylaws include all previously
adopted amendments in effect and no other changes, except, if
applicable, to correct scrivener's errors or to conform format
and style;
  (D) Be executed and acknowledged by the chairperson and
secretary of the association and recorded in the deed records of
each county in which the condominium is located; and
  (E) If required under subsection (6) of this section, be
approved by the commissioner.
  (d) The board of directors shall cause a copy of the recorded
restated bylaws, including the recording information, to be filed
with the commissioner. + }
  SECTION 28. ORS 100.417 is amended to read:
  100.417. (1) The board of directors of an association of unit
owners may act on behalf of the association except as limited by
the declaration or bylaws. In the performance of their duties,
officers and members of the board of directors   { - shall
exercise the care required of fiduciaries - }  { +  shall be
governed by this section and ORS 65.357, 65.361, 65.367, 65.369
and 65.377 whether or not the association is incorporated under
ORS chapter 65 + }.
  (2) Unless otherwise provided in the bylaws, the board of
directors of an association may fill vacancies in its membership
for the unexpired portion of any term.
  (3) At least annually, the board of directors of an association
shall review the insurance coverage of the association.
  (4) The board of directors of the association annually shall
cause to be filed the necessary income tax returns for the
association.
  (5) The board of directors of the association may record a
statement of association information as provided in ORS 94.667.
 { +
  (6) The board of directors, in the name of the association,
shall maintain a current mailing address.
  (7) The board of directors shall cause to be maintained and
kept current the information required to enable the association
to comply with ORS 100.480 (7). + }
    { - (6) - }  { +  (8) + } Unless otherwise provided in the
declaration or bylaws, the unit owners may remove any member of
the board of directors of the association, other than members
appointed by the declarant or persons who are ex officio
directors, with or without cause, by a majority vote of all
owners present and entitled to vote at any meeting of the owners
at which a quorum is present.
  { - No - }  Removal of a member of the board of directors is
 { + not + } effective unless the matter of removal is an item on
the agenda and stated in the notice for the meeting required
under ORS 100.407.
  SECTION 29. ORS 100.420 is amended to read:
  100.420. (1)(a) All meetings of the board of directors of the
association of unit owners shall be open to unit owners except
that, in the discretion of the board, the following matters may
be considered in executive session:
  (A) Consultation with legal counsel concerning the rights and
duties of the association regarding existing or potential
litigation, or criminal matters;
  (B) Personnel matters, including salary negotiations and
employee discipline;   { - and - }
  (C) The negotiation of contracts with third parties { + ; and
  (D) Collection of unpaid assessments + }.
  (b) Except in the case of an emergency, the board of directors
of an association shall vote in an open meeting whether to meet
in executive session. If the board of directors votes to meet in
executive session, the presiding officer of the board of
directors shall state the general nature of the action to be
considered   { - and - } , as precisely as possible, when and
under what circumstances the deliberations can be disclosed to
 
owners { +  and include the general nature of the action in the
minutes of the meeting + }.   { +
  (c) A contract or an action considered in executive session
does not become effective unless the board of directors,
following the executive session, reconvenes in open meeting and
votes on such contract or an action, which shall be reasonably
identified in the open meeting and included in the minutes. + }
    { - (c) - }  { +  (d) + } The meeting and notice requirements
in this section may not be circumvented by chance or social
meetings or by any other means.
  (2) Except as provided in subsection (3) of this section, board
of directors' meetings may be conducted by telephonic
communication { +  or through the use of any means of
communication by which all directors participating may
simultaneously hear each other or are otherwise able to
communicate during the meeting. A director participating in a
meeting by this means is deemed to be present in person at the
meeting + }.
  (3) In condominiums where the majority of the units are the
principal residences of the occupants { + , meetings of the board
of directors shall comply with the following + }:
  (a) For other than emergency meetings, notice of board of
directors' meetings shall be posted at a place or places on the
property at least three days prior to the meeting or notice shall
be provided by a method otherwise reasonably calculated to inform
unit owners of such meetings.
  (b) Only emergency meetings of the board of directors may be
conducted by telephonic communication { +  or in the manner
described in subsection (2) of this section + }.   { +
  (4) The requirements of subsections (1) and (3) of this section
do not apply to participation by members of the board of
directors in litigation, mediation or arbitration. + }
    { - (4) - }  { +  (5) + } Subsection (3)(a) of this section
first applies to property submitted to the provisions of this
chapter prior to October 3, 1979, upon receipt by the board of
directors of the association of unit owners of a written request
from at least one unit owner that notice of board of directors
meetings be given in accordance with subsection (3)(a) of this
section.
   { +  (6) As used in this section, 'meeting' means a convening
of a quorum of members of the board of directors where matters
relating to association business are discussed. + }
  SECTION 30. ORS 100.425 is amended to read:
  100.425. (1) Unless prohibited or limited by the declaration,
articles of incorporation or bylaws, any action that may be taken
at any annual, regular or special meeting of the association of
unit owners may be taken without a meeting if the association
delivers a written ballot to every association member that is
entitled to vote on the matter. { +  Action by written ballot may
not substitute for the following meetings:
  (a) The turnover meeting required under ORS 100.210.
  (b) The annual meeting of an association if more than a
majority of the units are the principal residences of the
occupants. + }
  (2)(a) A written ballot shall set forth each proposed action
and provide an opportunity to vote for or against each proposed
action.
  (b) The board of directors must provide owners with at least 10
days' notice before written ballots are mailed or otherwise
delivered. If, at least three days before written ballots are
scheduled to be mailed or otherwise distributed, at least 10
percent of the owners petition the board of directors requesting
secrecy procedures, a written ballot must be accompanied by { + :
  (A) + } A secrecy envelope { + ; + }   { - , - }  { +
  (B) + } A return identification envelope to be signed by the
owner { + ; + } and  { +
  (C) + } Instructions for marking and returning the ballot.
 { +
  (c) The notice required under paragraph (b) of this subsection
shall state:
  (A) The general subject matter of the vote by written ballot;
  (B) The right of owners to request secrecy procedures specified
in paragraph (b) of this subsection;
  (C) The date after which ballots may be distributed;
  (D) The date and time by which any petition must be received by
the board requesting secrecy procedures; and
  (E) The address where any petition must be delivered.
  (d) + } Notwithstanding the applicable provisions of subsection
(3) or (4) of this section, written ballots that are returned in
secrecy envelopes may not be examined or counted before the
deadline for returning ballots has passed.
  (3) Matters that may be voted on by written ballot shall be
deemed approved or rejected as follows:
  (a) If approval of a proposed action otherwise would require a
meeting at which a certain quorum must be present and at which a
certain percentage of total votes cast is required to authorize
the action, the proposal shall be deemed to be approved when the
date for return of ballots has passed, a quorum of unit owners
has voted and the required percentage of approving votes has been
received. Otherwise, the proposal shall be deemed to be rejected;
and
  (b) If approval of a proposed action otherwise would require a
meeting at which a specified percentage of unit owners must
authorize the action, the proposal shall be deemed to be approved
when the percentage of total votes cast in favor of the proposal
equals or exceeds such required percentage. The proposal shall be
deemed to be rejected when the number of votes cast in opposition
renders approval impossible or when both the date for return of
ballots has passed and such required percentage has not been met.
Unless otherwise prohibited by the declaration, articles of
incorporation or bylaws, the votes may be counted from time to
time before the final return date to determine whether the
proposal has passed or failed by the votes already cast on the
date they are counted.
  (4) All solicitations for votes by written ballot shall state
the following:
  (a) If approval of a proposal by written ballot requires that
the total number of votes cast equal or exceed a certain quorum
requirement, the number of responses needed to meet such quorum
requirement; and
  (b) If approval of a proposal by written ballot requires that a
certain percentage of total votes cast approve the proposal, the
required percentage of total votes needed for approval.
  (5) All solicitations for votes by written ballot shall specify
the period during which the association shall accept written
ballots for counting, which period shall end on the earliest of
the following dates:
  (a) If approval of a proposed action by written ballot requires
that a certain percentage of the unit owners approve the
proposal, the date on which the association has received a
sufficient number of approving ballots;
  (b) If approval of a proposed action by written ballot requires
that a certain percentage of the unit owners approve the
proposal, the date on which the association has received a
sufficient number of disapproving ballots to render approval
impossible; and
  (c) In all cases, a date certain on which all ballots must be
returned to be counted.
  (6) Except as otherwise provided in the declaration, articles
of incorporation, or bylaws, a written ballot may not be revoked.
  SECTION 31. ORS 100.427 is amended to read:
 
  100.427.  { + (1) + } Unless the bylaws provide otherwise, the
vote or votes of a unit owner may be cast by absentee ballot or
pursuant to a proxy executed by the owner.  { +
  (2) + } An owner may not revoke a proxy given pursuant to this
section except by actual notice of revocation to the person
presiding over a meeting of the association of unit owners { +
or to the board of directors if a vote is being conducted by
written ballot in lieu of a meeting pursuant to ORS 100.425 + }.
 { +
  (3) + } A proxy   { - shall not be - }  { +  is not + } valid
if it is undated or purports to be revocable without notice. A
proxy shall terminate one year after its date unless the proxy
specifies a shorter term.
  SECTION 32. ORS 100.450 is amended to read:
  100.450. (1) Whenever an association of unit owners levies any
assessment against a unit, the association of unit owners  { - ,
upon complying with subsection (2) of this section, - }  shall
have a lien upon the individual unit and the undivided interest
in the common elements appertaining to such unit for any unpaid
assessments   { - and interest as provided in subsection (2)(b)
of this section - } .  { + The lien includes interest, late
charges, attorney fees, costs or other amounts levied under the
declaration or bylaws. + } The lien   { - shall be - }
 { + is + } prior to a homestead exemption and all other liens or
encumbrances upon the unit except:
  (a) Tax and assessment liens; and
  (b) A prior mortgage or trust deed of record unless:
  (A) The condominium consists of fewer than seven units, all of
which are to be used for nonresidential purposes;
  (B) The declaration provides that the lien of any mortgage or
trust deed of record affecting the property shall be subordinate
to the lien of the association provided under subsection (1) of
this section; and
  (C) The holder of any mortgage or trust deed of record
affecting the property when the declaration is recorded executes
a separate subordination of the holder's interest to the
declaration which is attached as an exhibit and which states that
the holder understands that the declaration subordinates the
holder's lien to the assessment lien of the association provided
under subsection (1) of this section.
  (2)(a)   { - An association of unit owners claiming the
benefits of subsection (1) of this section shall record in the
county in which the unit or some part thereof is located a claim
containing - }  { + Recording of the declaration constitutes
record notice and perfection of the lien for assessments. No
further recording of a claim of lien for assessment under this
section is required to perfect the association's lien. However,
the association may record a notice of claim of lien for
assessments under this section in the real property records of
the county in which the unit is located. The claim of lien shall
contain:
  (A) + } A true statement of the amount due for the unpaid
assessments after deducting all just credits and offsets;  { +
  (B) + } The name of the owner of the unit, or reputed owner, if
known; { +  and + }  { +
  (C) + } The name of the condominium and the designation of the
unit as stated in the declaration or applicable supplemental
declaration.
  (b) When a claim has been filed and recorded pursuant to this
section and the owner of the unit subject to the claim thereafter
fails to pay any assessment chargeable to such unit, then so long
as the original or any subsequent unpaid assessment remains
unpaid such claim shall automatically accumulate the subsequent
unpaid assessments and interest thereon without the necessity of
further filings under this section.
 
  (3) { + (a) + } The claim shall be verified by the oath of some
person having knowledge of the facts and shall be recorded by the
county recording officer. The record shall be indexed as other
liens are required by law to be indexed.  { +
  (b) The board of directors shall cause a copy of a claim of
lien recorded under this section to be mailed to the mailing
address of the affected lot or to the mailing address designated
by the owner in writing to the association not later than 10 days
after the recording of the claim of lien. + }
  (4) { + (a) + } The proceedings to foreclose liens created by
this section shall conform as nearly as possible to the
proceedings to foreclose liens created by ORS 87.010, except that
notwithstanding ORS 87.055, a lien may be continued in force for
a period of time not to exceed six years from the date the
 { - claim is filed under subsection (3) of this section - }
 { +  assessment was due + }. For the purpose of determining the
date the   { - claim is filed - }   { + assessment is due + } in
those cases where subsequent unpaid assessments have accumulated
 { - under the - }   { + including a + } claim  { + recorded + }
as provided in subsection (2)(b) of this section, the
 { + assessment and + } claim regarding each unpaid assessment
shall be deemed to have been
  { - filed - }   { + levied + } at the time   { - such - }
 { + the + } unpaid assessment became due.  { +
  (b) + } The lien may be enforced by the board of directors
acting on behalf of the association of unit owners.  { +
  (c) + } An action to recover a money judgment for unpaid
assessments may be maintained without foreclosing or waiving the
lien securing the claim for unpaid assessments.  { +
  (d) + }   { - No - }   { + An + } action to foreclose a lien
under this section or recover a money judgment for unpaid
assessments may  { + not + } be maintained unless the Condominium
Information Report and the Annual Report described in ORS 100.250
are designated current as provided in ORS 100.255.
  (5) Unless the declaration or bylaws provides otherwise, fees,
late charges, fines and interest imposed pursuant to ORS 100.405
(4)(j), (k), (L) and (m) are enforceable as assessments under
this section.
  (6) With respect to condominium units also constituting
timeshare property as defined by ORS 94.803, liens created by
this section shall be assessed to the timeshare owners in the
timeshare property according to the method for determining each
owner's liability for common expenses under the timeshare
instrument and shall be enforced individually against each
timeshare owner in the condominium unit.
  (7) Notwithstanding the priority established for a lien for
unpaid assessments and interest under subsection (1) of this
section, the lien shall also be prior to the lien of any prior
mortgage or trust deed of record for the unit and the undivided
interest in the common elements, if:
  (a) The association of unit owners for the condominium in which
the unit is located has given the lender under the mortgage or
trust deed 90 days prior written notice that the owner of the
unit is in default in payment of an assessment. The notice shall
contain:
  (A) Name of borrower;
  (B) Recording date of trust deed or mortgage;
  (C) Recording information;
  (D) Name of condominium, unit owner and unit designation stated
in the declaration or applicable supplemental declaration; and
  (E) Amount of unpaid assessment.
  (b) The notice under paragraph (a) of this subsection shall set
forth the following in 10-point type:
_________________________________________________________________
 
 
  NOTICE: The lien of the association may become prior to that of
the lender pursuant to ORS 100.450.
_________________________________________________________________
 
  (c) The lender has not initiated judicial action to foreclose
the mortgage or requested issuance of a trustee's notice of sale
under the trust deed or accepted a deed in lieu of foreclosure in
the circumstances described in ORS 100.465 prior to the
expiration of 90 days following the notice by the unit owners'
association.
  (d) The unit owners' association has provided the lender, upon
request, with copies of any liens filed on the unit, a statement
of the assessments and interest remaining unpaid on the unit and
other documents which the lender may reasonably request.
  (e) The borrower is in default under the terms of the mortgage
or trust deed as to principal and interest.
  (f) A copy of the notice described in paragraph (a) of this
subsection, together with an affidavit of notice by a person
having knowledge of the facts, has been recorded in the manner
prescribed in subsection (3) of this section. The affidavit shall
recite the date and the person to whom the notice was given.
  SECTION 33. ORS 100.475 is amended to read:
  100.475. (1) A unit owner shall be personally liable for all
assessments imposed on the unit owner or assessed against the
unit by the association of unit owners.
  (2) Where the purchaser of a unit obtains title to the unit as
a result of foreclosure of the first mortgage or trust deed, such
purchaser, the successors and assigns of the purchaser, shall not
be liable for any of the assessments against such unit or its
owner which became due prior to the acquisition of title to such
unit by such purchaser except as specifically provided otherwise
in ORS 100.450. Such unpaid assessments shall be a common expense
of all the unit owners including such purchaser, the successors
and assigns of the purchaser.
  (3) { + (a) Subject to paragraph (b) of this subsection, + } in
a voluntary conveyance of a unit, the grantee shall be jointly
and severally liable with the grantor for all unpaid assessments
against the grantor of the unit to the time of the grant or
conveyance, without prejudice to the grantee's right to recover
from the grantor the amounts paid by the grantee therefor.  { +
  (b) + }   { - However, - }  Upon request of a prospective
purchaser the board of directors shall make and deliver a
statement of the unpaid assessments against the prospective
grantor or the unit, and the grantee in that case shall not be
liable for, nor shall the unit when conveyed be subject to, a
lien filed thereafter for any unpaid assessments against the
grantor in excess of the amount therein set forth.  { +
  (4) An escrow agent or title insurance company providing escrow
services or issuing title insurance in conjunction with the
conveyance may rely upon a statement of unpaid assessments
delivered pursuant to subsection (3) of this section and is not
liable for failure to pay to the association at closing any
amount in excess of the amount set forth in the statement. + }
  SECTION 34. ORS 100.480 is amended to read:
  100.480. (1) { + (a) Except as provided in paragraphs (b) and
(c) of this subsection,  + }the association of unit owners shall
retain within this state the documents, information and records
delivered to the association under ORS 100.210 { +  and all other
records of the association for not less than the period specified
for the record in ORS chapter 65 or any other applicable law + }.
 { +
  (b) The documents specified in ORS 100.210 (5)(j), if received,
must be retained as permanent records of the association.
  (c) Proxies and ballots shall be retained for one year from the
date of determination of the vote. + }
 
  (2) The association of unit owners shall keep financial records
sufficient for proper accounting purposes. All assessments shall
be deposited in a separate bank account, located within this
state, in the name of the association. All expenses of the
association shall be paid from the association bank account.
  (3) Within 90 days after the end of the fiscal year, the board
of directors shall  { + prepare or cause to be prepared an annual
financial statement consisting of a balance sheet and income and
expenses statement for the preceding fiscal year and shall + }
distribute to each unit owner a copy of the annual financial
statement   { - consisting of a balance sheet and income and
expense statement for the preceding fiscal year - } .
  (4)(a) The association shall provide, within 10 business days
of receipt of a written request from an owner, a written
statement that provides:
  (A) The amount of assessments due from the owner and unpaid at
the time the request was received, including:
  (i) Regular and special assessments;
  (ii) Fines and other charges;
  (iii) Accrued interest; and
  (iv) Late payment charges.
  (B) The percentage rate at which interest accrues on
assessments that are not paid when due.
  (C) The percentage rate used to calculate the charges for late
payment or the amount of a fixed charge for late payment.
  (b) The association is not required to comply with paragraph
(a) of this subsection if the association has commenced
litigation by filing a complaint against the owner and the
litigation is pending when the statement would otherwise be due.
  (5) { + (a) Except as provided in paragraph (b) of this
subsection, + } the documents, information and records described
in subsections (1) to (3) of this section and all other records
of the association of unit owners   { - shall be located within
this state and shall - }   { + must + } be reasonably available
for examination { +  and, upon written request, available for
duplication + } by a unit owner and any mortgagee of a unit. Upon
the written request of an owner or mortgagee of a unit, the
association shall make the documents, information and records
described in subsections (1) to (3) of this section and other
records available for duplication during reasonable hours.
   { +  (b) Records kept by or on behalf of the association may
be withheld from examination and duplication to the extent the
records concern:
  (A) Personnel matters relating to a specific identified person
or a person's medical records;
  (B) Contracts, leases and other business transactions to
purchase or provide goods or services, currently under
negotiation;
  (C) Pending or probable litigation. As used in this
subparagraph, 'probable litigation' means those instances when
there has been a specific threat of litigation from a party or
the legal counsel of a party;
  (D) Matters involving state or local administrative or other
proceedings before a government body for enforcement of the
declaration and bylaws, or rules and regulations promulgated
pursuant to the declaration and bylaws;
  (E) Communications with legal counsel that relate to matters
specified in subparagraphs (A) to (D) of this paragraph;
  (F) Disclosure of information in violation of law;
  (G) Documents, correspondence or management or board reports
compiled for or behalf of the association or the board of
directors by its agents or committees for consideration by the
board of directors in executive session held in accordance with
ORS 100.420 (1);
 
 
  (H) Documents, correspondence or other matters considered by
the board of directors in executive session held in accordance
with ORS 100.420 (1); and
  (I) Files of individual owners, other than those of a
requesting owner or requesting mortgagee of an owner, including
any individual owner's file kept by or on behalf of the
association.
  (6) + } The association of unit owners shall maintain a copy,
suitable for the purpose of duplication, of the following:
  (a) The declaration  { - , - }   { + and + } bylaws,
 { + including amendments or supplements in effect, recorded
plat, if feasible, and + } association rules and regulations
 { - and any amendments or supplements thereto - }  { + currently
in effect + };
  (b) The most recent annual financial statement prepared in
accordance with subsection (3) of this section;   { - and - }
  (c) The current operating budget of the association  { - . - }
 { + ;
  (d) Reserve fund plan, if any, consisting of a plan of
contributions from regular and adequate assessments, adjusted by
estimated inflation and interest earned on reserve funds,
sufficient to meet a 30-year schedule for maintenance, repair and
replacement; and
  (e) Architectural standards and guidelines, if any. + }
    { - (6) Upon the written request of a prospective purchaser,
the association of unit owners shall make available for
examination and duplication during reasonable hours the documents
and information specified in subsection (5) of this section. - }
   { +  (7) The association, within 10 days after receipt of a
written request by an owner, shall furnish the information
necessary to enable the owner to comply with ORS 105.465 or
105.475. + }
    { - (7) - }  { +  (8) + } The   { - association of unit
owners may charge - }   { + board of directors, by resolution,
may adopt reasonable rules governing the frequency, time,
location, notice and manner of examination and duplication of
association records and the imposition of + } a reasonable fee
for furnishing copies of any documents, information or records
described in this section. The fee may include reasonable
personnel costs incurred to furnish the information.
    { - (8) - }  { +  (9)  + }Subsection (3) of this section
first applies to property submitted to the provisions of this
chapter before January 1, 1982, when the board of directors of
the association of unit owners receives a written request from at
least one unit owner that a copy of the annual financial
statement be distributed in accordance with subsection (3) of
this section.
  SECTION 35. ORS 100.625 is amended to read:
  100.625. (1) Subject to the provisions of the declaration and
any applicable law, and upon compliance with this section:
  (a) A unit designated in the declaration to be used for
commercial, industrial or other nonresidential purpose may be
divided by an owner, including the declarant, into two or more
units.
  (b) A unit owned by the declarant and located in a condominium
that consists exclusively of units designated in the declaration
to be used for nonresidential purposes, may be divided or
converted into two or more units, common elements or a
combination of units and common elements.
  (2) The owner of a unit to be divided or converted shall submit
to the board of directors of the association of unit owners a
proposed amendment which shall:
  (a) State the purposes of the amendment;
  (b) Assign an identifying number to each unit created;
  (c) Reallocate the interest in the common elements and the use
of any limited common elements, voting rights, common expense
liability and the right to common profits in the manner
prescribed in the declaration;
  (d) Indicate the means of access for each unit to common
elements; and
  (e) Include any additional provisions necessary to conform any
other provisions of the declaration or bylaws.
  (3) The board of directors shall approve the proposed amendment
unless the board determines within 45 days that the amendment is
inconsistent with the declaration or bylaws, or the division or
conversion will impair the structural integrity or mechanical
systems of the condominium or lessen the support of any portion
of the condominium.
  (4) The board of directors may require the owner of the unit to
be divided or converted to submit an opinion of a registered
professional engineer as to whether or not the proposed division
or conversion will impair the structural integrity or mechanical
systems of the condominium or weaken the support of any portion
of the condominium. The board of directors or any agent appointed
by the board of directors may supervise the work necessary to
effect the division or conversion. Any expenses incurred under
this section shall be charged to the owner of the unit requesting
the division or conversion.
  (5) The amendment shall be executed by the owner and mortgagees
or trust deed beneficiaries of the affected unit, certified by
the chairperson and secretary of the association and approved and
recorded in accordance with ORS 100.135   { - (1)(b) - }  { +
(2)(b) + }.
  (6) A plat showing each unit created or the conversion of a
unit to common elements or combination thereof shall be recorded
in accordance with ORS 100.115.
  (7) This section applies only if the declaration expressly
permits and contains:
  (a) A statement of the maximum number of units into which a
unit may be divided under subsection (1) of this section;
  (b) A general description of the nature and proposed use of any
unit or portion of any unit which the declarant may convert to
common elements; and
  (c) A statement of the method to be used to reallocate interest
in the common elements, the use of any limited common elements,
voting rights, common expense liability and right to common
profits.
                         ----------