Vermont Legislature SmartTranscripts:

[Marc Mihaly (Chair)]: Thank you, welcome everybody to the House Committee on General and Housing. Today is Thursday, March is moving right along. One, two, three, four, five, six, we have a quorum, a Bayer quorum. I know that we will be joined by our vice chair in a moment, and our ranking member will be in and out. I just wanna start off by by saying to those who are looking at us on video and anyone in the room that bear with us, this is a difficult time of this is the last week before crossover, so people are in and out. Yesterday, we had two bills before we had two bills before Ways and Means. Tom Charlton was there, and Gayle Pezzo was there, I will be in appropriations from ten to eleven today, and either our vice chair or vice chair will take over while I'm gone. It's just the nature of things this week. We have a number of bills we're gonna take this morning. We're gonna look at H 172, which is an act relating to establishing a common interest community resource center. And that bill is gonna be considered. We're gonna hear from David Hall, from the secretary of state's office, from Cameron, and then we're gonna discuss it and potentially vote on it. Then we'll take a look at eight seven zero four, and that is an act relating to tenant representation pilot program, and there, we're not scheduled for a vote. That is primarily an appropriations matter going forward. But looking backward, the community the committee expressed an interest in finding out, has this program worked? What is it accomplished? And this is a chance to hear about that. And then finally, we're there is a five fifty six, which is an act relating to exceptions to applicability of state minimum wage. That bill remember, we had testimony yesterday from both our legislative council and from the League of City, the Vermont League of Cities and Towns, and there's a redraft coming to us and a potential vote. So that's the morning. So let's start. Cameron, take it take it away with H-one 172. Good morning. Cameron Wood, Office

[Cameron Wood (Office of Legislative Counsel)]: of Legislative Counsel. I only have been in here two weeks. Oh, hey. We've missed you, Terrence. It's been a little while. Do

[Ashley Bartley (Vice Chair)]: you need us to reintroduce ourselves?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Okay,

[Cameron Wood (Office of Legislative Counsel)]: we're going to do a walk through of H-one 172. Share my screen.

[Elizabeth Burrows (Member)]: Okay,

[Cameron Wood (Office of Legislative Counsel)]: an act relating to establishing a common interest community resource center. Before I jump into the language, I'm just going to back up a second and talk about common interest communities. Generally,

[Marc Mihaly (Chair)]: you probably kind

[Cameron Wood (Office of Legislative Counsel)]: of hear them referred to HOAs, homeless associations, but those entities are in statute referred to as common interest communities at this point. And it really is a pretty in-depth and hard to distinguish area of law because first off there are multiple different acts that could be applicable. And secondly, it's all going to depend on what type of community it is. Is it a condominium or is it a planned community? And thirdly, it's going to depend then on how that entity is organized and how the declaration outlines the organization of the community itself. And then beyond the declaration, you then have the entities governing bylaws and rules, etcetera. So there's multiple different layers to common interest communities. For starters, if the entity predates the Uniform Act, this body adopted the Uniform Act and made it effective 01/01/1999. So if one of these condominium associations predates that, then it actually comes under the jurisdiction of the Condominium Ownership Act, which is in Title 27, title related to property. And that outlines all the regulations that you all put in place to govern those entities, how they go about organizing themselves, how they have to communicate with their members, how the members interact, their ownership of certain common elements and how they vote, etcetera. 01/01/1999, you all enacted the Uniform Common Interest Ownership Act. You made certain provisions of the Uniform Act applicable retroactively, but not all of them. And it's a pretty extensive piece of legislation. I should have

[Marc Mihaly (Chair)]: While you're looking, a comment for the committee, in many places in The United States, particularly in newer communities, particularly in the West, much of the housing, almost a great majority of the housing is in these kinds of HOAs, common inter subdivisions. And they're only called common interest because you own your home, maybe you own your lot, but there's all kinds of common things. There may be a clubhouse, there may be a swimming pool,

[Emilie Krasnow (Ranking Member)]: There's a may be clubhouse.

[Marc Mihaly (Chair)]: All this stuff. Or at the very least, a little park or something like that. They're governed by what are called CCNRs. They have an internal governance. They have a certain amount of their remedies they can exercise. There's huge potential for abuse because they're sort of private organizations. All kinds of bad things happen. So, there are, in many states, fairly developed regimes, and there are places where people can go to complain about common into subdivisions. It also applies to apartment buildings, which are condominiums, that's a common interest subdivision, you own your condominium. When very often you go to buy a condominium, the law in these states requires that they show you the minutes for the last year and all that stuff. So, it's a little less common here because, you know, we're Vermont, but it's fairly common in parts of Vermont that are urban, And the motive behind this bill, if I can just say it, was to kind of, remember our ranking member saying, gosh, a year ago, that this was a matter that it was time to revisit, think about. And this is kind of that light, which is merely, can we establish just some sort of web based resource center?

[Cameron Wood (Office of Legislative Counsel)]: I don't know if you want

[Marc Mihaly (Chair)]: to say anything, just I'm trying to get, I'm interrupting you, only because this is a bill from last year, so I'm refreshing everybody's memory.

[Emilie Krasnow (Ranking Member)]: Yeah, and I did do an introduction, but I'll refresh the intent for everyone as well. I've lived in an HOA for twenty one years, because I'm older than I look. Yeah. And so, I've been, familiar with all the processes, the board. I also represent a part of South Burlington that has a tremendous amount of homeowners association. So over the years, in my long legislative career, I have heard from a number of constituents saying that there's no place in state government to learn. There's no place anywhere to get information about what people are doing. It's often people who are retired, who, you know, are just trying to do the best they can. It's us running the board and people I'm in a small HOA of 29 units, and we're just doing the best we can self managing. But I have members, so I've not as much expertise as Cameron, but I've done a lot of digging into this over the years because it is such a big part of where I represent and get so many emails about this, that other members in the building started to come up to me after I had exposed myself as an HOA interest person, talking about how in their communities too, they've heard from people. I had a member the other day whose father's in an HOA who was like, I don't know the rules on XYZ. Do you know where to go? And I was like, Well, there's a bill for that. I felt like Elizabeth Warren. But we don't have anything in Vermont, and other states do have something like this. So we're gonna talk, in a minute with the Secretary of State's office. But I would love if there was just a central place where people could go and see all the information. There are so many I don't know the numbers about how many homeowner associations we have for Vermont, but in my district, it takes up most of it. And so anyway, so that was the intent to refresh everyone's memory. So I would just like to have a place in government as a resource that people can go to to learn the information that's accurate and not having these people making up things on the fly and just not knowing the rules. And it would be helpful to, for monitors, to have that space.

[Marc Mihaly (Chair)]: Greenland's Mail is a web based.

[Emilie Krasnow (Ranking Member)]: I do. So we can get into what my intent in the bill. It would be the resource center. Yeah, it's not a place or a position. My intent was that if a constituent reaches out to you and has a HOA question, or just I would hope that we can, as legislators, if this passed, raise awareness and let our constituents know that this exists now. But yes, I imagine that as a web based resource center that an agency within state government sets up puts all that information, and I will get into when we have the Secretary's office, that there are national organizations who already have this type of model and would like to help wherever it goes. But anyway, we'll get into that when we have where it might, where we want it, where we had in the bill put it. Yes, it's a web based and not to be like, it doesn't seem like that much work, but we'll get into that and But see what year if it a web a website. And then if there's changes to law, which aren't quite often, very rare. So it's kind of a one time setup. And then if there are tweaks in the state house to HOA law, then whoever's running the site would go in. But also, want to be clear. This isn't a place where they take like, isn't like, I don't like that. My neighbor has chickens. I don't like this or that. Excuse my voice. Late night. So it's not a complaint center. This is just an information center. They could still complain to all of us, and then I'll send them to the center to learn more, but their complaints can go to us. But as of now, there's just no That's my

[Marc Mihaly (Chair)]: Gayle, I do wanna let him do the walkthrough. This a question for now or after he

[Mary E. Howard (Clerk)]: does the walkthrough? After he does

[Marc Mihaly (Chair)]: the walkthrough. Okay, all right. Go ahead. I just want, for

[Cameron Wood (Office of Legislative Counsel)]: the record, make sure I'm heard Krasnow that said we could send all complaints.

[Emilie Krasnow (Ranking Member)]: To me. People do. If you have a constituent who has an HOA question,

[Ashley Bartley (Vice Chair)]: I'm happy to talk to them.

[Cameron Wood (Office of Legislative Counsel)]: Okay. So I brought up the Uniform Act just so you all know where it exists in title 27A and I cannot walk through all of this because it has four different articles and this is just one of them. It's quite extensive. These are just the general provisions. Then you have Article II, which is about creating them, how they're created, what has to be in the declaration, what the declaration has to define as far as unit boundaries, description of units, allocation of the interests, how they're allocated. Then it talks about you have limited common elements, which are elements that are owned in common, but they're for the exclusive use of individuals. So think about the patio of the condominium, maybe a limited element. It's outside your door. You have the exclusive use of it. But how those limited elements can be altered or reassigned to other unit owners. So these are quite extensive, and this is just the creation and alteration of them. Then you get to Article III, which is about management how they're organized, what's the power of the owners' associations, bylaws, meetings, when they have to meet, what's a quorum, voting of members. So again, my point of simply bringing this up is not to walk through all of this with you all. I imagine later in the session we might have a reason to, depending on whether bills come this way or not. But I'm bringing this up just to identify the depth of the issues related to common interest communities and how challenging I imagine it can be for just a member of the public who is a unit owner to try to understand what the rights and responsibilities are of the association itself or the unit. So as I mentioned, the law could depend on when the association or when the community was created. Is it pre-nineteen ninety nine? So it's under the Condominium Ownership Act. Is it post-nineteen ninety nine? So it's under the Uniform Common Interest Ownership Act. Is it created post-twenty eleven because there were amendments to the Uniform Act that were done in 2011, that some were applied retroactively. So that's your first question. Then you have to ask, is it a condominium or is it a planned community? What's the difference between those? It depends on who owns the common elements. In a condominium, each of the unit owners themselves own undivided interests in the common elements, whereas in a planned community, the common elements are owned by the association itself, not owned by the individual members. So that can be an important distinction. And so then, as I mentioned, I assume if you have a community resource center and somebody called up and said, well, this is going on, I assume they would be very challenged in being able to answer a specific question because it's going to depend on a lot of those factors. And if you're frustrated with something that the unit association is doing, it's then going to depend on, well, what do their bylaws say and what do their rules say? And so a lot of depth here is just what I'm trying to get at. So I'm going to walk through the bill. And unfortunately, I have to step out at 09:30, but I would be happy to answer any questions that anyone has while I'm here or offline. But the bill itself is going in Title X, VSA 700. So it's adding here a common interest community resource center. Sub A, Office of the Secretary of State shall establish and maintain the resource center to provide information to the public about Vermont's common interest ownership communities. Moving to page two, sub two, the Secretary of State may contract that out. So they can contract that out with a nonprofit. The Common Interest Resource Center shall assist the public in understanding and navigating issues related to common interest communities, provide information materials and guides for the creation and administration of common interest communities, including matters related to the organization, the governance, budgeting, conflict resolution, transparency, and rights of responsibilities, and ensure the information required in the subsection is made available online in a user friendly format. So a pretty straightforward bill, but I imagine the practical lift of it would be pretty significant with whatever entity is going go about doing this. And we'd have

[Marc Mihaly (Chair)]: to change the applicable date. Yes, sir,

[Cameron Wood (Office of Legislative Counsel)]: you would.

[Marc Mihaly (Chair)]: Okay. Old.

[Emilie Krasnow (Ranking Member)]: Thanks.

[Marc Mihaly (Chair)]: Any questions? Yes, go ahead.

[Gayle Pezzo (Member)]: So, I'm confused because I don't know if Is it specific to HOAs that so people can get the information of what an HOA is or the individual HOA? Cameron,

[Emilie Krasnow (Ranking Member)]: I should also stop calling it HOA. I should call it common interest. Because

[Gayle Pezzo (Member)]: that's my question is

[Mary E. Howard (Clerk)]: each HOA is that

[Gayle Pezzo (Member)]: the bylaws are addressed?

[Emilie Krasnow (Ranking Member)]: That are different. Oh yeah, we have different, right.

[Marc Mihaly (Chair)]: You couldn't possibly do that

[Emilie Krasnow (Ranking Member)]: in Oh the god.

[Marc Mihaly (Chair)]: The bank resource center is just intended as a very simple, what's the basic law, where do you find the law, what are the basic rules, you know, that would be applicable to everyone, and to

[Emilie Krasnow (Ranking Member)]: tell people, to tell

[Marc Mihaly (Chair)]: people, mean, one of the things, when you buy a condo, or you participate, you're supposed to get a packet that includes the aging, everything in it. I mean, a class and there are all kinds of problems, often because, let's say a building is built, occupied, and it's twenty years later, everybody in the building is old. And they don't wanna move and they don't wanna and that every year they were supposed to contribute to a sinking fund of some sort. So when the elevator broke, they're demoney. Right? And then but they didn't because they they voted that that this year we won't do it, the next year we won't do it. And then someone young and new moves in, and the elevator breaks. And there I mean, there's so many issues like that. I had a flood. Yeah.

[Emilie Krasnow (Ranking Member)]: Right. Thanks to our dues. It paid it. But no, and can I say one more thing that Cameron alluded to, to the committee? I don't even know if people know, but I want to be transparent. There's a Senate housing bill that has HOA stuff in it. So I think he was kind of pushing us to maybe attach to that and not vote it out by itself.

[Marc Mihaly (Chair)]: I'm not pushing I know. I know. I know. I'm not pushing

[Emilie Krasnow (Ranking Member)]: you to No. You mentioned because with the crossover time, if we don't finish what we need to do to get this out, I'm being transparent saying that there's another if people like this bill an option.

[Marc Mihaly (Chair)]: That's an option. Yeah.

[Emilie Krasnow (Ranking Member)]: If people like this bill and things get hectic in the next two days, there is a vehicle for it, and I don't need my name on the credit.

[Cameron Wood (Office of Legislative Counsel)]: And my comment was

[Emilie Krasnow (Ranking Member)]: board's So

[Cameron Wood (Office of Legislative Counsel)]: if the Senate bill, the housing bill comes out in a similar form to what it's currently in. It has HO, it has some changes to the Common Interested Community Uniform Act. And so I may be here talking much more in-depth about specific statutory language and requirements in the Common Interested Community section. We may get much more in-depth for what's in Title 27A if that bill maintains its current amendments and comes to this committee.

[Emilie Krasnow (Ranking Member)]: And I'm not a lawyer, but I think that this bill would likely be germane to that bill. Right. Anyway, I wanted to be transparent that it's an option for everyone. I'm not trying to force it out now.

[Marc Mihaly (Chair)]: Any other questions of camera? Thank you. Yes, absolutely.

[Emilie Krasnow (Ranking Member)]: Five minutes early for you.

[Cameron Wood (Office of Legislative Counsel)]: Gonna hang up to five then.

[Marc Mihaly (Chair)]: Oh, okay. Or for two or three. So our next witness is David Law, who's Director of Business Services and the Secretary of State's Office.

[Emilie Krasnow (Ranking Member)]: And for those of us who have been around for a little bit, returning. Former. Former Cameron.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Honored to still be recognized among you. Thank you. Good morning. David Hall, Director of Business Services Division at the Secretary's Office. So I'm here for a couple different reasons. First, our general counsel to the entire Secretary of State's office, Jenny Prosser, is with the kid at the dentist, but she's monitoring and I actually just got a message from her that was helpful. Second, my division, the business services division does have some nexus because Ukiowa the or V Kiowa, whatever you wanna call it, calls for the associations that manage these entities, these communities to be organized and they can choose whatever form they want that's available in the state, they have to have one. And then that means by definition, they have to register with us because we register businesses. So your homeowners association is the group that operates a planned interest community, so don't lose sight of that, that is an entity onto itself. Lastly, yes, in my former life I did staff the adoption of the amendments in February, working with Carl just went quite closely on this, the revisions to Vermont's adoption of uKiowa, so I'm pretty deeply familiar with it. And what to say? We get calls. We are the place I think people think of at least part of the time about what's going on with their common interest community. I think Department of Housing may get calls. I think DFR sometimes get calls. I think lots of people get calls because nobody knows who to call. And here's why, this is an issue that is extremely complicated on the one hand and on the other, there really is no frankly state public government nexus to it. That may sound really odd to you given the prevalence of the communities, I'm sure you all have them in your districts, they are befuddling to many people because they're quite complex, and yet there's no state agency department with regulatory authority over them, not even enforcement capacity, unless there's some sort of consumer protection issue involved in this case that the state's trying to get involved. So this is a private thing. It's a matter of contract among the people who, first of all, the developer who makes the thing in the first place then passes it along, the ownership and the responsibility to the unit owners, and then they have to self govern and a private manager, there's private law governing private activity.

[Marc Mihaly (Chair)]: David, let me interrupt you, because I admit to being somewhat shocked about your last statement that there's no regulatory authority. I mean, in so many states, there is an entity which if you, which, let's say you don't have bylaws that you distribute, has the regulatory authority to require that and fine people, is there no one here that can do that?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Like I said, unless you're going to construe it as a consumer protection component

[Marc Mihaly (Chair)]: But then it's the AG, short of the AG, there's no agency that's been designated as having regulatory authority over these entities.

[Cameron Wood (Office of Legislative Counsel)]: Yeah, that's correct.

[Marc Mihaly (Chair)]: Unlike a town which has regulatory authority over land use. Right?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Yes. Zoning subdivision bylaws, complaints, ordinances, town comes in in all of all the ways. So if there were overlap with the violation there, but like you said, if they failed to observe a procedural process or they didn't adopt bylaws that met the requisites of the statute itself, then your relief is to go through the associations, not to go to DHCD and say, what do we call it these days? It's changed me so many times. So like I said, it's a curious, it's something, so Jenny, what she wrote to me, Jenny Prosser, our general counsel wrote that she gets HOA governance calls a few times a month. Does try to help with the basics of, as you're suggesting, here are the 101 sort of ground rules for what the default provisions are in the statute. And we try to help in that way to the extent we can. The problem is, Cameron, cogently articulated to you, is that it is a fact specific inquiry in pretty much every case. That is because there are articles and bylaws that govern the operations of each different community, that just knowing what law is supposed to apply to a particular community and then even within that community to an issue is hard because it was adopted in phases. There are exceptions for communities of certain size or of certain operating value. If their fees are super low, they could opt out of this, in which case this law wouldn't even apply to them. Or if it's a small unit, a small community, then it doesn't apply either. Are Can you explain that? Yeah, there is an exception to the applicability of the statute for a small common interest community.

[Emilie Krasnow (Ranking Member)]: And what would that be?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: And I can't remember if it's 12 or it's 20, I'd have to look. Oh, that's real small. It is, it is. No,

[Emilie Krasnow (Ranking Member)]: but that's kind of not right. When

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: 12 or 10 what? Units. Units, sorry. So let me, probably I should disclose for the record, I actually am an owner in a three unit condominium and we are not subject to this law, but that's confusing, right?

[Ashley Bartley (Vice Chair)]: So the reason I ask, I live on a private road, and in Fairfax, our zoning says that if you live on a private road, you have to be a part of an HOA. And full disclosure, our HOA is amazing. Shout out to Chelsea. She's great. We love That being said, when we were looking for a house, we said, Under no circumstances, do we want an HOA? We found this place, we found the neighbors, it's just absolutely amazing. And it's truly because we share the road, it's a private road, and that is it. So in this case, it would be houses on the road, like houses that are on the shared common interest, correct?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: So different regulatory authority, different requirements.

[Marc Mihaly (Chair)]: You just proved his point.

[Emilie Krasnow (Ranking Member)]: But why couldn't that be something that's said on the website? Because

[Marc Mihaly (Chair)]: they do that now, saying I don't know all the time.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Well, know, I mean,

[Marc Mihaly (Chair)]: we are not covered by that law.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: You could be subject to both, it depends. So to be a common interest community regulator in entitled 27A is a very intentional thing. You have to have created a planned community. You have to have very extensive filings in land records about your plats, your subdivisions, the rights of the owners, as the Chair has indicated, when you buy into these things, you have to receive all the information either from the original developer or from the subsequent seller who had bought into it. And so it's an eyes wide open information but private law construct. So I guess here's the reality. There is no way that you set up a center that's called this, and you vest it with somebody, whether it's us or anybody, and you don't get a million calls and they aren't fact specific. And we can try to help, but we can't resolve those problems. And it's not just a question of do we wanna be helpful or can we be helpful? This is legal advice Because every one of these every time there's a dispute, somebody's rights weren't observed, somebody didn't disclose the right thing, that is a problem of contract, and that is a problem of interpretation and application of law. So whoever does this needs to know what they're talking about. It's possible you're establishing an attorney client relationship at that point, and that's why I wanna draw the fine distinction between what we do in places like, let's say, DEC versus this. So, or even in my division, people call me, they say, what do I need to file to make sure my business is X? And I say, you are forming an LLC, so you have to file our organization. Your duty is to do an annual report every year, but I'm advising them on their regulatory compliance with the laws that I'm charged with enforcing. When they ask me questions like, what should my operating agreement say? Should I form an LLC or a corporation? I say, those are private legal decisions that you need to make with the advice of your hands. So that's sort of the dividing line here as well. Can I give can we give people basic information about what u Kiowa says? Sure. Can I give legal advice about that vote they just took and whether they observed the proper procedure? No.

[Emilie Krasnow (Ranking Member)]: Yeah. Can I I'm not I'm trying to be contrary, but I don't think this bill is asking for any of that? Your concern, what I'm relaying, is that if this is available to people, then it may spur more calls. Is that what you're trying to say? I have So we offer inform ask to have the state offer more information.

[Marc Mihaly (Chair)]: It's just saying there's there's limits to what they have.

[Emilie Krasnow (Ranking Member)]: No, but I'm not asking them to offer any of those things.

[Marc Mihaly (Chair)]: Yeah, the latter. Yeah.

[Emilie Krasnow (Ranking Member)]: So I'm asking if is your concern that if you do have this in your jurisdiction that it'll create more calls and ask them for advice. That's what I'm asking.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: 100%.

[Emilie Krasnow (Ranking Member)]: I think it would, right, I agree. That's a good flag.

[Marc Mihaly (Chair)]: I guess, let me sharpen that question for you. Yeah, please. If all we're talking about is a website that has on it the law, a link to the law, an explanation that looks like what we've just heard in twenty five minutes, you know, in other words, it depends on the age of your HOA, etcetera, here are the basics of the law in a couple of pages just for your information, blah, blah, blah. Do you have a problem with that kind of level of information center? Is that I mean, I'm wondering whether it's arguable you get less calls. People can look at your center, your web page.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: I I would say that's consistent with the work that we do in all areas. You know, every division and most subjects have their own web pages on the Secretary of State's website, and I don't think we would be by any means opposed to having a page dedicated to common interest communities for informational purposes.

[Marc Mihaly (Chair)]: There isn't one now.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: I'm not to And

[Emilie Krasnow (Ranking Member)]: that is the whole point of the bill,

[Marc Mihaly (Chair)]: that's I all it think that, but I don't want to paint you into a I'm really trying to get at your reality in your work. I think we're very aware this bill doesn't have an appropriation. We want you to have to hire a whole individual at a law center that's gonna say, can say, Send me your articles, etcetera. Although, I am really interested by the reality that there is no entity that has regulatory authority over these things. It's just abuses that I've seen in other states are enormous. That's probably why. Yeah. I'm going rogue. But but I think that what what our intention is just about what you said, a page or whatever that has the kind of thing you would ordinarily have on.

[Emilie Krasnow (Ranking Member)]: And maybe that doesn't even need to be a lot. Can we just say, can the Secretary of State add a tab that just has that information and we don't need the law? I mean, I don't know. I mean, I'm not trying to know a few people that work in your office. Like, there's some interest maybe. Like, can someone just make it? I don't wanna assume the level of work. I feel like it's already somewhere. Cameron outlined some of it. Like, maybe we just call the law and just have you in and make that request from your office that we just get a tab that has its own information. I mean, is that something you could bring to your don't know if you make that decision or someone else that we just start with that for now? I mean, is that something we could know That's about, but just ask you to make a above my pay grade. Okay.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: I mean, I'm definitely willing to take it back. I do wanna stress that my concern is both the lines that we can and cannot cross, but it's also capacity. I mean, we've added one person to the municipal practice that Jenny manages and they spend more than their allocated hours of work every week with public records requests and also helping municipalities Oh, right, right, with their governance. And they have gone from one to two and they are still maxed. And I mean, there's nothing that needs to be done that doesn't require work. I'm not sure I can work. We'd like to help. I think it is inevitable that we will get more calls and more inquiries. And guess the other thing is, and I don't know if there's any real way to thread this needle in the statute if it becomes one, is these are, some of these places probably don't need free help, right? Are, not to pick on stoke, but there are wealthy people who have wealthy communities, and they pay lawyers lots of money to do these things. And then there are the smaller ones or the older ones that are just they just need help, and I get it. So like I said, I'm not sure there's a willing

[Emilie Krasnow (Ranking Member)]: to come and self manage that line. We don't have a lawyer.

[Marc Mihaly (Chair)]: I think that I'm assuming that a webpage would have a see your lawyer.

[Emilie Krasnow (Ranking Member)]: A lawyer button. Lashing.

[Marc Mihaly (Chair)]: Well, it's pretty I can tell you from my own experience in there, there's no way in hell they can go very far on their website other than the kind of stuff we've talked about here. The kind of stuff you've heard in the last thirty five minutes is the kind of stuff that once you go further, you're right in the weeds. Yeah, it's been been

[Unidentified Member]: I'm just curious, so like, if there Do the statutes that exist when the overhaul was done fifteen years ago Let's say a legislator said I was approached by a neighbor in our HOA that said, I think in California, they just legislated that you have to enable email communications and electronic votes. And that to me is a fundamental, we have to upgrade our modus operandi to reflect current technology and the way that we all live and operate. So that seems like something that needs to be done statewide and communicated to the HOAs. So what would happen with something like that?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: If the legislation were changed and it needed to be updated? Yeah,

[Unidentified Member]: So if there is a bunch of legislation on the books, and we're trying to and we tweak something in there, how you communicate with your members, Are you saying that the problem is that there's no way to remedy if they don't, or there's a problem because there's no, or not problem, but that there is no ability to oversee whether that happened or not? Or are you saying that we just don't even have the legal standing or whatever to actually tell the HOAs how to operate?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: I mean, there's no mechanism right now, to my knowledge, that would push out, for instance, a bulletin that says, Dear all HOAs, you should be aware of the following changes. But I mean, that's sort of a problem inherent of every law you adopt, right? Right.

[Marc Mihaly (Chair)]: Right. It's inherent, and there's no regulatory entity that's in charge of that. Right.

[Emilie Krasnow (Ranking Member)]: And that was also one of my concerns with the Senate bill that we'll get is that there were some changes, and communities wouldn't have enough or won't know, and they could violate that issue. So with a resource center, they would know what Yes,

[Marc Mihaly (Chair)]: the website.

[Cameron Wood (Office of Legislative Counsel)]: Ignorance of the law is not

[Marc Mihaly (Chair)]: a Yeah. But it is I think you're pointing out something really important, which is Well, let me ask you first, David.

[Emilie Krasnow (Ranking Member)]: Did Mary have a question?

[Marc Mihaly (Chair)]: I'm sorry.

[Unidentified Member]: Oh, that's okay. Well,

[Marc Mihaly (Chair)]: following up, does the current law require that people, that HOAs have meetings?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: I believe so, and it also prescribes what notice you'd have to give in advance, and the ability to participate. Right, and the question, yeah. Communication mechanisms, all those things.

[Marc Mihaly (Chair)]: Right. Does the current HOA require law require reserves?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: I don't know, to be honest

[Marc Mihaly (Chair)]: with you. I don't think so. Good lord. We have We are

[Cameron Wood (Office of Legislative Counsel)]: so reserved.

[Marc Mihaly (Chair)]: Yes. First, I no. First, I think it's Yeah. Hail, then Mary.

[Gayle Pezzo (Member)]: I can't remember what that

[Marc Mihaly (Chair)]: was. Do you remember what you were getting?

[Mary E. Howard (Clerk)]: Know what it was.

[Gayle Pezzo (Member)]: Representative Krasnow is familiar with this, but I spent a good six weeks in trying to find out about an HOA, and what would have helped is if there was a registry for HOAs, and there's not, and there is in other states, so that if I at least have been able to find the registry, I could get more information from that entity.

[Marc Mihaly (Chair)]: Well, I think we need I not to think we have to separate out. I think it's good that we're having conversations. Have to separate out the fact that we're learning the more you learn about common into subdivisions, the more you'll realize that maybe there's work to be done Mhmm. Next term or whenever to try to get a better situation. This is about a pretty simple registry. Mary?

[Mary E. Howard (Clerk)]: Thank you. I am a member of an HOA, and my development is private, private road, and when we have an annual meeting, if someone can't attend, they will send by proxy their vote. We had a situation where ten years ago our treasurer embezzled thousand dollars from our association, and it was only discovered by a neighbor who said, we haven't seen the treasurer's recall. And so it was brought to court, she knew she was guilty, was going to plead guilty, but her attorney said, plead not guilty, And the judge gave her duty service and she was to pay $100 a month restitution. Why? She started paying a $100, then it went to 50, and then it was late, and today she is up to date with her payments, but she's not even to the halfway mark. To the residents, it seems pretty unfair because many of them have already died. And I just learned that she's opening up a business and there's nothing we can do about that.

[Ashley Bartley (Vice Chair)]: Elizabeth? Thank you.

[Elizabeth Burrows (Member)]: I would like to just ask a question going back to HOAs being or common interest communities being private law governing private activity. How does that fit with Dillon's rule?

[Unidentified Member]: Like, does does that supersede local ordinances? Does that supersede?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: No, it stands beside it. So you would be subject to both. If you had a community that was located within a municipality that adopted zoning and subdivision, then you would be subject to that separately. And then it it Is it equal?

[Elizabeth Burrows (Member)]: I mean, it's side by side, is it equal?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: No. I mean, not necessarily. I mean, if there were a provision, for instance, in common interest communities bylaws that violated zoning, it would still be a zoning violation. You still have to comply with the zoning provisions.

[Ashley Bartley (Vice Chair)]: So it's more behavior

[Mary E. Howard (Clerk)]: kind of?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Yeah, think of it as we all enter into one big contract together and all of the provisions, the bylaws, the articles, the plats, the everything that govern our community together, we're all responsible to one another to observe all of the provisions that are in that contract, and if there's a violation, it's a breach, and we can collectively try to hold you accountable. You can petition the association to redress some sort of perceived wrong, but it's that's whatever you wanna say. It's private. It's internal. You have signed up, you have agreed to be part of this community, and it's be governed by

[Marc Mihaly (Chair)]: its private rules. Let me give you an example. Please do. Here's a pretty controversial, but not uncommon example. The HOA has a rule that you can only paint your house one of these five colors. Yeah.

[Emilie Krasnow (Ranking Member)]: Oh yeah, we have that.

[Marc Mihaly (Chair)]: Okay. You painted a different color. The HOA can sue you and say, you have to paint a different color. You don't. The HOA can then put a lien on your unit in the amount of what it would cost to repaint it. When you sell your unit, let's say you sell it for $300,000, it's 300,000 minus the cost of repainting, and then they can repaint it. So there's an example of private law. You know, that's all private. That's between the HOA and you. If your town adopted a law that said, there shall be no limitations on color.

[Elizabeth Burrows (Member)]: Or there shall be limitations

[Marc Mihaly (Chair)]: on Well, but whatever, it would prevail. In other words, and tell me if I'm wrong, David, HOAs, that contract is not protected against contrary requirements of zoning law. I gotcha.

[Elizabeth Burrows (Member)]: Of course, it made me think of Manchester, where you have to have your during in a certain area of Manchester, you have to have white a house painted white with green clabber. Right. But that is a

[Marc Mihaly (Chair)]: That trumps the

[Gayle Pezzo (Member)]: Right. That trump but Which one trumps?

[Marc Mihaly (Chair)]: The the state law or the the The town zoning. But I don't know, David, are there situations where towns it's protected by the contract clause Yes. Something like that?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: That's the one that's a great that's exactly where I was going. And and in fact, when the amendments were adopted You couldn't reach back. You'll see in the implementation section of that law that only certain provisions apply to certain communities because of the contracts clause concerns. I mean, states usually win contracts clause cases, but we still try to be cognizant of it and quickly that's just where you would pass a law that sort of retroactively implicates or adversely affects parties to an existing contract.

[Marc Mihaly (Chair)]: But it's like, for example, there were, well, of course, there were HOAs that prohibited renting or selling your unit to anyone of color or a Jew, and state law preempted that, but that had the advantage that those are protected classes. There is the problem he's alluding to. I actually had to brief this at one point. There is a provision of the United States constitution called the contract clause, which protects contracts from actions that invalidate or change the contracts by the state. The idea was, you know, you enter into a contract to build something or do something, the state can't go in halfway through and change it. There are exceptions. There's a whole body of laws. What people tend to do, and that's why I think these laws were a lot of these laws are not retroactive or they're very careful about being retroactive is because they don't want litigation around the contract laws. Why bother? Just grandfather or whatever the term now is, the old stuff. But, you know, a lot of Slice is gone. Prohibit solar on the roof, or they prohibit anything on the roof, you know, because it's deemed uncycled. And then I think there's a state law now that we passed that says no, but I don't know what we did with retroactivity there. Yes, Ashley, go ahead. My understanding

[Ashley Bartley (Vice Chair)]: of the bill in front of us, and I'll refer to the ranking member, is that it is the creation of a website for information. We're not looking to change the law. Is that correct?

[Emilie Krasnow (Ranking Member)]: Yeah, we're getting real meaty because this is a can of worms conversation. But it's first

[Marc Mihaly (Chair)]: time for people.

[Emilie Krasnow (Ranking Member)]: No, yeah, we're having it. But yes, you're correct. For the sake of everyone's time and your time. You are not our legislative council anymore, so we're kind of treating

[Ashley Bartley (Vice Chair)]: you like one. I do have, I do, it's connected. Bill's looking for information, materials, and guides for the creation and administration of common interest communities, including matters related to organization, governance, budgeting, conflict resolution, transparency, and rights and responsibilities for homeowners and associations, and ensuring the information required by the subsection is made available online in a user friendly format at no cost to the public. Okay, that is the directive of this bill. As we said, there's no appropriations. Is it reasonable to not put in appropriations in this at the capacity that your department has right now?

[Marc Mihaly (Chair)]: You knew you were gonna get asked about this.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: So I appreciate the question, I think it depends on which direction you go. If these words on the page are the ones that survive, then I'm getting really nervous about the scope of what we're supposed to be doing. If the words on the page become more akin to three, let's make sure we have a good public information resource about the basic framework of the Common Interest Community Act and sort of

[Marc Mihaly (Chair)]: the

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: default provisions governing things like formation, operation management, dispute resolution. We're in the process of revamping our website. Like I said, we do dedicate pages. Like if you go to my division site right now, you'll find information about what is an LLC. You will not find me telling you, here's why you should adopt one, and here's why

[Ashley Bartley (Vice Chair)]: it's better or worse than that. Or

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: You will find the basics. Here's what it means, here's what you do, here's the defaults, here's where you need to start talking to your employer. And so that's, if it's the latter, I don't think we need an appropriation.

[Marc Mihaly (Chair)]: Which the latter, are there words that you want out? Sure. It's one to every one.

[Ashley Bartley (Vice Chair)]: Number two says provide information, materials, guides for the creation and administration. That's my understanding of what you would like to see.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Almost twenty years ago, I learned a golden rule, do not draft in the chair.

[Emilie Krasnow (Ranking Member)]: Okay. Okay, I'm gonna wrap this up. Like I have Oh, think I can Oh, go ahead.

[Marc Mihaly (Chair)]: You go ahead.

[Ashley Bartley (Vice Chair)]: I'm not okay,

[Marc Mihaly (Chair)]: you go ahead.

[Ashley Bartley (Vice Chair)]: And maybe this is more for

[Marc Mihaly (Chair)]: It is, but I don't mind him sitting here. As chair, it's fine if we leave him sitting here while we have committees.

[Ashley Bartley (Vice Chair)]: You know what, I'll wait for committee discussion.

[Emilie Krasnow (Ranking Member)]: Well, I was gonna give him an assignment.

[Marc Mihaly (Chair)]: Well, let's, I want a chance. If it's okay with the committee, have to leave in a minute. I think it's good that David stay in the room that we discuss this because I think we're gonna wanna bounce a few things off of him. And so I'm transitioning to discussion, and David, if it's okay with you to stay a little? Okay, go ahead. You were going through the list, which I think is valued.

[Emilie Krasnow (Ranking Member)]: So I was going to ask David since Ashley brought it up, David, since you're not going to We all agree it's best not to do it in the chair. Would you mind, because, again, we have time for this. Would you mind drafting, your in writing to our committee so that we can share with Cameron to look at it with I don't know, I can't think of the word, because I don't want to say watering down. It's not that we don't use that. It's Distilling. Distilling it down to what your office could be capable of and what probably my request initially was and what could be done. And again, knowing that there is another view, like, it doesn't have to make progress over this time. Would that be something that you could provide for us to distill it to what could be more of just a tab?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: I mean, sure. I'm a little only hesitating because you're the policy making body, and I don't wanna put words in your mouth. Happy to work with you and with Cameron on language. I can also articulate to you the things that I see that give me more heartburn or less. And if you wanna hear them, great. And if you don't, that's your prerogative as

[Unidentified Member]: a lipstick. It sounds to me like, in the the reworking of the rest of your website that you have some limits of criteria in the sense of what's too meeting, what's

[Marc Mihaly (Chair)]: what's helpful.

[Unidentified Member]: How would this be ordered so that it would be consistent with the approach you're taking with the rest of your website?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Well, I mean, so that's a good question. That's a good way to put it. I gotta tell you, my first gut reaction is I would really like to not call this a resource center. Oh, change the name. And the reason being because, you know, I want to provide information to people, but I don't want to be the center for your resources of how you solve all your problems in your common interest community. In that same vein, on page two and B1, I'm great with helping you understand the issues. I don't necessarily think it's appropriate for us to help you navigate them. This is that dividing line I keep trying to draw between information, guidance, crown, rules, framework, specific legal advice, problems, specific issues, community specific problems.

[Emilie Krasnow (Ranking Member)]: And

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: two, I like information and materials. I'm a little bit more reluctant to use the word like a guy because I don't want people coming to us and saying, here's the one zero one on how you set up a planned interest community. Oh, yeah. That's that's really that is a legal framework that people need some significant help with. And then three is exactly, I think what we're talking about. That's an online resource that provides the fundamental information and also has a big fat caveat that says your specific case is probably gonna depend on your articles of bylaws.

[Mary E. Howard (Clerk)]: Yeah. What would be the trend down what you are currently doing when you get a call?

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Well, think we could have some more robust information on the website, but as far as the council, I don't think much different. Jenny has a couple of different scripts to help people understand things like voting requirements, and not specific to yours, but what does the statute say about how many meetings do you have to have, or is that something that can be governed by the bylaws, for instance? So I think directly it's going to much change person to person counsel or advice or question answering, but I do think the resource could be more robust.

[Mary E. Howard (Clerk)]: Did anyone else have a hand? Body bodies, Chairman? I

[Ashley Bartley (Vice Chair)]: would say, does anyone else have any questions or comments for David before we have

[Emilie Krasnow (Ranking Member)]: Oh, a committee right. I thought we were having that and he was just here for it. I think that's what

[Marc Mihaly (Chair)]: it's Okay.

[Emilie Krasnow (Ranking Member)]: I was just gonna say, how does the committee feel if I work with David and Cameron on a more what did you call it? Distilled?

[Mary E. Howard (Clerk)]: I like that. Have a for you.

[Emilie Krasnow (Ranking Member)]: A more distilled version that could be doable and perhaps moving forward, we may work again. We have the Senate bill coming over that has some HOA stuff in it that will, yeah, doesn't seem like we have the time to distill it by Friday. So I don't need my name on it if we end up adding this to the Senate bill. It's not very controversial, so I don't think they would, Right?

[Ashley Bartley (Vice Chair)]: Yeah, I think my question was going to be, I think this is a great conversation, but also understanding that tomorrow is Friday. Do you have concerns about adding this to the Senate bill when it comes to voting?

[Emilie Krasnow (Ranking Member)]: No, no, I've been very clear to myself and to Cameron, but I didn't know if the committee knew. I'm a nerd, so I've been watching the Senate hearings So, every I know what's in their bill. No, not at all. And I don't need credit. I mean, some of me thinks maybe this could have even just been a conversation. And it still might be. We don't know. That's another thing to bring back. Like, it still could just be as you're revamping, if you want Anyway, we'll be David, I will email you and Cameron over the again, this will not make process occur. So What is that?

[Ashley Bartley (Vice Chair)]: I just wanna make sure

[Emilie Krasnow (Ranking Member)]: I'm okay with that. It is it's gonna be alright for me.

[Ashley Bartley (Vice Chair)]: Just, I think communities will survive.

[Emilie Krasnow (Ranking Member)]: It is a

[Ashley Bartley (Vice Chair)]: small but mighty bill. Oh, that's

[Emilie Krasnow (Ranking Member)]: very fine.

[Ashley Bartley (Vice Chair)]: And I think the information that we're trying to provide is great. Think one of my concerns is, again, I love this, our HOA is great. We are super hands off. But if it's just like calling it something other than a resource, like, what if it's just like the statue is online? Right, that'd be great. But, I mean, we all read statutes and sometimes we're

[Unidentified Member]: like, what does this mean?

[Emilie Krasnow (Ranking Member)]: Right, it would have to be like So

[Ashley Bartley (Vice Chair)]: I think it does need to be more curated. I just I would love to unpack it just a little bit more personally for me.

[Emilie Krasnow (Ranking Member)]: But I'm still very supportive No, of think that's great. I think that's great. And I'm happy with that. So we'll connect offline. And the last thing I want to do is create more work for already under resourced, understaffed agencies. This is a constituent bill that a lot of people in the building liked because this is right. And so, let's just discuss the best path forward. And for me, as the lead sponsor, I am comfortable with whatever the capacity is of your organization, or I guess, call it agency. What do you call yourself? Here we go.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Whatever. We refer to it as an agency.

[Emilie Krasnow (Ranking Member)]: Thank you so much. So, I'm sure you have a lot of busy

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: It's alright, I'm glad to be here, it's nice come across the street.

[Emilie Krasnow (Ranking Member)]: Ear of humble returns.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: I guess, you know, I don't wanna, you never wanna volunteer somebody else for work. I will say that a successful model in my career that I've seen has been my dear friend Arthur Hanlon working on mobile homes. I don't know if this rises to the same level as needing something like that, but along the lines of We

[Emilie Krasnow (Ranking Member)]: have committee members who think it does.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Sure, so I guess that's an alternative. I mean, we can provide information, I think he provides substantive assistance of a unique kind to mobile home communities, if you Oh, I love that. In your wisdom think that this rises to the level of that, then maybe having a division in the department like the mobile home division would be an alternative or a supplement to what we might do.

[Emilie Krasnow (Ranking Member)]: Well, yeah, maybe we'll see if we can, for now, this, and then

[Unidentified Member]: Ashley, come up with a

[Emilie Krasnow (Ranking Member)]: No, no, I was gonna say, and then if there's a member of the committee who really wants this, and myself can work over if we're reelected, we can introduce something that has a little more teeth and see. Maybe we'll have a lot of money to start to rain on us next year. You never know.

[Elizabeth Burrows (Member)]: You never know. Thank you.

[Emilie Krasnow (Ranking Member)]: But yeah, certainly the reading, you know how that goes.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: Great. Are you guys set

[Elizabeth Burrows (Member)]: with me? We're all set. Wonderful. Thank you much. Thank you for having me in. Great to see you.

[David Hall (Director of Business Services, Vermont Secretary of State’s Office)]: It's gonna go back down the hall. You know, it's like reunion day.

[Ashley Bartley (Vice Chair)]: Love it. Wonderful. Good to see you. Thanks, David.

[Emilie Krasnow (Ranking Member)]: I'm happy to come back anytime.

[Ashley Bartley (Vice Chair)]: Thank you. Committee, we were discussing this until 10:45. I think we kind of wrapped that up very well. So we are going to adjourn until 10:45, and then be talking about H-seven zero four, and that's the tenant representation pilot program.

[Mary E. Howard (Clerk)]: Oh yeah, before we adjourn, H-fifty seven. You all know how important that bill is to me. I have a letter here being sent to the speaker's office and to the chair of appropriations. And I would like to circulate this, and I hope that you will support this since we did vote it out twice unanimously.

[Ashley Bartley (Vice Chair)]: Great. So I will circulate this. Just a reminder, age 57 was Jessica's Law, and it's the benefits survivor rights benefits. Right. That we put it on that last year.

[Unidentified Member]: And where is the occurrence?

[Ashley Bartley (Vice Chair)]: It is still two years of probation.

[Emilie Krasnow (Ranking Member)]: Did you talk to Chair Mihaly about this letter? Or you just I'm not accusing Did

[Mary E. Howard (Clerk)]: you Do you not remember that you volunteered?

[Emilie Krasnow (Ranking Member)]: No, Mary, I'm not being combative. Was just No, I'm not. He's not here right now. Certainly

[Mary E. Howard (Clerk)]: will mention it to him.

[Emilie Krasnow (Ranking Member)]: That's all I was asking. Not saying like, I was just asking. I was here when we discussed. I know that piece, but now you have a letter and he's not here, so before everyone else

[Mary E. Howard (Clerk)]: Joe isn't here either, yes, I will see that every member has the opportunity to sign up. So we're appreciated, thank you.

[Ashley Bartley (Vice Chair)]: We're going to adjourn and come back at 10:40