By Kyle Grant
As the end of the year fast approaches, community associations should ensure compliance with the new requirements in HB 2534 to remove discriminatory provisions from governing documents. The deadline for compliance is December 31, 2022. The requirement, adopted in House Bill 2534 in the 2021 legislative session, includes specific anti-discrimination laws and requires communities to conduct a review of their governing documents–an exercise seen as necessary to root out any lingering vestiges of discrimination in private covenants.
What are the new prohibitions and requirements?
The new legislation prohibits including any language in governing documents that would restrict the use of a community, lots, or units because of race, color, religion, sex, sexual orientation, national origin, marital status, familial status, source of income, disability, or the number of individuals (including family members, persons of close affinity, or unrelated persons) who are simultaneously occupying a dwelling unit within occupancy limits.
While the intended effect of HB 2534 is to render such discriminatory language void and unenforceable, the bill also includes an affirmative requirement for community associations to conduct a review of each of their governing documents as necessary to remove such language.
Associations have two options to comply:
Option 1: Amend or restate each document as necessary to remove all discriminatory language; or
Option 2: Execute and record a declaration that the association has reviewed the governing documents and that they do not contain any discriminatory language.
What is the deadline to conduct the review?
The amendment or review requirement must take place on or before December 31, 2022. Note that this deadline applies not only to the review itself, but the recording of any amendments or declaration of review. In order to avoid noncompliance claims, associations should make plans to give themselves sufficient time to have the documents recorded with their county recorder’s office before the deadline.
What governing documents must be reviewed?
Although it’s not apparent in the text of HB 2534 alone, the definition of governing documents includes both the recorded declaration and bylaws as well as unrecorded resolutions, rules and regulations, and other policies that may have been adopted by the association’s board of directors.
Is owner approval required?
No. The bill specifically allows the association’s board of directors to adopt any amendment, restatement, or declaration necessary to comply with HB 2534.
Do condominium amendments or restatements need to be approved by the Oregon Real Estate Agency?
Yes. If a condominium association needs to make an amendment or restatement, it may require approval by the Oregon Real Estate Agency (OREA) in accordance with the Oregon Condominium Act. If, however, a condominium is satisfied after review that there are no discriminatory provisions and only a declaration of review is required, OREA does not need to be involved. The requirement for OREA approval does not apply to planned community associations.
What should communities do to plan for compliance?
In almost all cases, a simple declaration of anti-discrimination review consistent with HB 2534 will be all that is needed. However, in order to confidently certify such a declaration, community associations should consult with legal counsel to assist in the review process. It is not always easy to spot language that is discriminatory or has an unintended discriminatory impact, especially when it relates to disability or familial status. Examples include rules regulating recreational rooms, pools, and other common facilities or rules governing modifications of common areas. Communities should also carefully review the “single family” use restriction as it relates to occupancy by residents.