Condominium associations illustrate the challenges of representative democracy at the local level. Consider a condo association with three homeowners that has to decide whether and how to pay for the replacement of their leaky roof. Or an 11-unit condo that needs to decide who should pay for a new heating system that will be used directly by just six owners. Or a 21-unit condo that wants to replace its antiquated fuel oil heating system with a modern natural gas system.
These situations present challenges for a condo association’s board of directors. Faced with a dispute about the way forward, the default solution is often to do nothing, which would lead to continued reliance on fossil fuels and an outdated and uneconomic heating system.
Condo associations can be a barrier to improved energy efficiency. Condo associations can block the installation of solar or heat pump systems that need to pass over and through a condo building’s common elements. Rather than fully reckoning with the pros and cons of energy-efficiency projects, condo associations may focus, for example, on the appearance of a rooftop solar installation.
Many condo associations in Maine and elsewhere are major energy wasters, and many Mainers face high heating bills. In Maine and New England, the electricity industry has made major progress in recent years in achieving greater use of renewables to displace fossil fuels; thus, for them, much of the low-hanging fruit has already been captured.
The Maine Condominium Act is very clear on one thing: Condo boards have to act in good faith. Beyond that, however, little useful and practical guidance is provided. Condo associations necessarily have a role to play in regulating the use of a condo’s common elements. Under the Maine Condominium Act, condo associations have regulatory powers that allow them to restrict condo owners’ ability to reduce the carbon footprint of their condo unit if there are impacts on the common areas. The problem is that condo board members are given the duty to deal with situations that are substantively challenging without guidance about how to do so.
Unlike a typical state regulatory agency, such as the Maine Public Utilities Commission, condo associations are given little guidance as to how they are to use their regulatory powers. The Maine Condominium Act delegates regulatory tasks to condo associations with respect to encroachments on common property but provides little guidance as to how condo boards should go about deciding disputes.
In contrast, public utilities commissions must comply with the requirements of the U.S. Constitution, state and federal law, and the commission’s own rules and regulations. Moreover, public utilities commissions use open and transparent administrative procedures, which give parties and interested persons a reasonable opportunity to participate in the decision-making process. None of this is necessarily true for condo associations.
Legislative guidance to condo associations may be needed. Maine has a solar rights law but has not provided guidance or restrictions on condo associations’ authority to block solar or energy-efficiency projects for aesthetic or other reasons if they affect common areas. It is my understanding that many states, including California, Colorado, Hawaii and Texas, have adopted laws that limit condo and homeowner associations’ ability to restrict the installation of energy equipment by homeowners, which can apply to solar systems and to energy-efficiency and renewable-energy equipment.
California, for example, is serious about solar. Starting in 2020, solar will be mandatory in new housing. That state’s recently enacted solar rights law restricts condo associations from prohibiting rooftop solar as a general matter and prevents a condo board from requiring that new rooftop solar projects be approved by a general vote of all condo owners.
For condo associations, a bare-minimum oversight framework should include some degree of due process. Condo associations should give affected homeowners the opportunity to present arguments and evidence, provide written reasons for their decisions and actions and provide an opportunity for parties to request reconsideration of the board’s decision.
To be credible, a condo board should do sufficient due diligence that it can make an informed decision – one that considers the benefits of building upgrades that improve energy efficiency and reduce the building’s carbon footprint, as well as concerns about the impact of these proposals on the common areas of the building. A condo association can condition its decision to require that an individual owner bear the costs of ensuring that impacts on the common areas are minimized.
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