Assembly passes A5043, amending Chapter 106

By Mandy Coriston
The State Assembly voted on Thursday, June 20, to pass Bill A5043/S3661, a clarification of the statute which defines membership in planned real estate developments and lays out the voting rights of members in such associations. The bill was introduced earlier this year in response to communities interpreting a 2017 amendment to the same statute to mandate membership in associations which previously did not require compulsory participation.
The language in the new amendment is very clear in regard to forced membership. The opening statement on purpose declares, in part, “It is necessary and in the public interest for the Legislature to: (1) clarify that P.L.2017, c.106 (C.45:22A-45.1 et al.) did not impose new responsibilities on property owners to pay compulsory charges; and (2) protect property owners from the issuance of sudden, unanticipated compulsory charges in planned real estate developments where assessments have historically been voluntary.”
The bill also states that any liens placed on property where the owners did not comply with new mandatory membership charges are to be made null and void. The legislation, if signed by Governor Murphy, would go into effect immediately and be retroactive to the last amendment on July 13, 2017. District 24 Assemblymen Hal Wirths and Parker Space and Senator Steve Oroho co-sponsored the bills in their respective houses.
“Homeowners who purchase a property that isn’t part of a community association shouldn’t have to fear surprise assessments and compulsory fees,” said Wirths, “You can’t change the rules in the middle of the game, and that’s exactly what some communities have tried to do.”
The Chapter 106 amendment will put an end to the membership battle which has been brewing at Cranberry Lake in Byram over the last year. The Cranberry Lake Community Club and their attorney Eileen Born were taking the 2017 amendment to mean they could mandate dues from all property owners surrounding the lake, despite many arguments that the CLCC is not, nor has ever been, anything more than a recreational group and not a homeowners’ association. Unhappy residents have been fighting the mandate since the announcement in July 2018.
The CLCC had been asking members in good standing to call and write to key Assembly members to oppose the bill, a campaign which did not succeed. The vote on A5043/S3661 came just two weeks after the club was served notice by the state that they must close the footbridge which spans the lake near the clubhouse, due to safety concerns. The CLCC is under lease with the NJDEP for the footbridge, the beaches, and the clubhouse, which was signed in 1990 and is currently in holdover status.
With the bridge closed and lacking funds for the necessary repairs, the CLCC would have been well-served to receive an influx of new memberships, which would have brought in approximately $600 for each household forced to join the club. Newsletters to CLCC members show that the club fears without that new income, they may be in danger of losing their lease and having to relinquish their facilities back to the state.
It remains to be seen if the CLCC will challenge the new statute by pursuing a fair share assessment of the lake, but if the governor signs A5043/S3661 into law, the club will no longer nor ever be able to force membership. A similar issue had been coming to light in Forest Lakes, just a few miles north on Rt. 206 from Cranberry Lake; other lake communities around the area have also been affected by the interpretation of the 2017 amendment. A5043/S3661’s sponsors and supporters are optimistic that the legislation will be signed shortly.