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Virginia

Commonwealth of Virginia Common Interest Manager Licensure Regulations

In 2008, Virginia implemented a statutory based management company licensure program.  As part of that program, the Common Interest Community Board (CICB) was created and charged with drafting regulations to clarify and assist with implementation of the new law.  In fall of 2008, the CICB approved emergency regulations while they continued to draft, vet and publish the final regulations. During the vetting process, the Community Association Institute (CAI)   actively solicited feedback from our members, worked with CAI’s Virginia Legislative Action Committee and provided official comment to the committee and CICB.

The regulations are final and are part of the permanent regulatory requirements governing licensing, replacing the initial set of emergency regulations on April 1, 2010.  To assist in your understanding of the permanent regulations, we have outlined the changes below.

The provisional license expires on June 30, 2011.  By June 30, 2011 all companies will need to follow all of the community manager regulations:

The major areas of the law that community association management firms need to prepare for include:

1.     18VAC48-50-30 Qualifications (professional education/designation requirements)

a.       Applicants/licensees shall hold an active Accredited Association Management Company (AAMC) designation granted by Community Associations Institute (CAI)

OR

 b.      Applicants/licensees must have at least one supervisory employee or officer with five years of community association management experience who has successfully completed a comprehensive training program as approved by the board and at least 50% of persons who have principal responsibility for management services to a common interest community must meet one of the following.

        i.      Hold an active designation as a Professional Community Association Manager (PCAM)  and certify having provided management services for a period of 12 months immediately preceding application;

        ii.      Hold an active designation as a Certified Manager of Community Associations (CMCA) by the Community Association Managers International Certification Board (CAMICB) and certify having two years of experience in providing management services. Of the required two years experience, a minimum of two years of experience must have been gained immediately preceding application;

        iii.      Hold an active designation as an Association Management Specialist (AMS) and certify having two years of experience in providing management services. Of the required two years experience, a minimum of 12 months of experience must have been gained immediately preceding application; or

        iv.      Have completed an introductory training program, as set forth in 18VAC48-50-250 A, and [passed a] certifying examination approved by the board and certify having two years experience in providing management services. Of the required two years experience, a minimum of 12 months of experience must have been gained immediately preceding application.

2.     18VAC48-50-30 Qualifications - The licensee shall submit evidence of a blanket fidelity bond or employee dishonesty insurance policy.

While this regulation is not new from the emergency regulations, it is an important component of the qualifications of an applicant. The applicant shall submit evidence of a blanket fidelity bond or employee dishonesty insurance policy in accordance with § 54.1-2346 D of the Code of Virginia (the policy shall provide coverage in an amount equal to the lesser of $2 million or the highest aggregate amount of the operating and reserve balances of all associations under control.  Minimum coverage shall be $10,000). Proof of current bond or insurance policy must be submitted in order to obtain or renew the license. The bond or insurance policy must be in force no later than the effective date of the license and shall remain in effect through the date of expiration of the license.

3.     18VAC48-50-70 Annual Assessment

This regulation has changed slightly.  The new regulations state that when the annual assessment due is less than $1,000, applicant/licensee shall submit documentation of gross receipts for the preceding calendar year.  Documentation of gross receipts is not required when an applicant/licensee submits the maximum annual assessment amount of $1,000.  Acceptable documentation may include, but is not limited to, audits, tax returns or financial statements.

4.     18VAC48-50-190 Compliance with the prohibited acts

While this regulation is not new from the emergency regulations, it has changed slightly.  Below is the new list of prohibited acts.

A.    The following acts are prohibited and any violation may result in disciplinary action by the board:

1.   Violating, inducing another to violate, or cooperating with others in violating any of the provisions of any of the regulations of the board or Chapter 23.3 (§ 54.1-2345 et seq.) of Title 54.1 of the Code of Virginia, Chapter 4.2 (§ 55-79.39 et seq.) of Title 55 of the Code of Virginia, Chapter 24 (§ 55-424 et seq.) of Title 55 of the Code of Virginia, Chapter 26 (§ 55-508 et seq.) of Title 55 of the Code of Virginia, or Chapter 29 (§ 55-528 et seq.) of Title 55 of the Code of Virginia, or engaging in any acts enumerated in §§ 54.1-102 and 54.1-111 of the Code of Virginia.

2.   Allowing the common interest community manager license to be used by another.

3.   Obtaining or attempting to obtain a license by false or fraudulent representation, or maintaining, renewing, or reinstating a license by false or fraudulent representation.

4.   A regulant having been convicted, found guilty, or disciplined in any jurisdiction of any offense or violation enumerated in 18VAC48-50-180.

5.   Failing to inform the board in writing within 30 days that the regulant was convicted, found guilty, or disciplined in any jurisdiction of any offense or violation enumerated in 18VAC48-50-180.

6.   Failing to report a change as required by 18VAC48-50-150 or 18VAC48-50-170.

7.   The intentional and unjustified failure to comply with the terms of the [management] contract, operating agreement, or [association] governing documents.

8.   Engaging in dishonest or fraudulent conduct in providing management services.

9.   Failing to satisfy any judgments or restitution orders entered by a court or arbiter of competent jurisdiction.

10. Incompetence in providing management services.

11. Failing to handle association funds in accordance with the provisions of § 54.1-2353 A of the Code of Virginia or 18VAC48-50-160.

12. Failing to account in a timely manner for all money and property received by the regulant in which the association has or may have an interest.

13. Failing to disclose to the association material facts related to the association's property or concerning management services of which the regulant has actual knowledge.

14. Failing to provide complete records related to the association's management services to the association within 30 days of any written request by the association or within 30 days of the termination of the contract unless otherwise agreed to in writing by both the association and the common interest community manager.

15. Failing upon written request of the association to provide books and records such that the association can perform pursuant to §§ 55-510 (Property Owners Association Act), 55-79.74:1 (Condominium Act), and 55-474 (Virginia Real Estate Cooperative Act) of the Code of Virginia.

16. Commingling the funds of any association by a principal, his employees, or his associates with the principal's own funds or those of his firm.

17. Failing to act in providing management services in a manner that safeguards the interests of the public.

18. Failing to make use of a legible, written contract clearly specifying the terms and conditions of the management services to be performed by the common interest community manager. The contract shall include, but not be limited to, the following:

  • Beginning and ending dates of the contract;
  • Cancellation rights of the parties;
  • Record retention and distribution policy;
  • A general description of the records to be kept and the bookkeeping system to be used; and
  • The common interest community manager's license number.

5.     18VAC48-50-200 Establishment of code of conduct

The firm shall establish and distribute to the firm's employees, principals, and agents a written code of conduct to address business practices including the appropriateness of giving and accepting gifts, bonuses, or other remuneration to and from common interest communities or providers of services to common interest communities. In accordance with clause (ii) of § 54.1-2346 E of the Code of Virginia, the code of conduct for officers, directors, and employees shall also address disclosure of relationships with other firms that provide services to common interest communities and that may give rise to a conflict of interest.

6.     18VAC48-50-210 Establishment of internal accounting controls   

The firm shall establish written internal accounting controls to provide adequate checks and balances over the financial activities and to manage the risk of fraud and illegal acts. The internal accounting controls shall be in accordance with generally accepted accounting practices.

7.     18VA48-50-230 through 18VAC48-50-290 Training Programs and Examination   The VA CICB has outlined two training programs; one is an introductory training program that must include 16 contact hours and the other is a comprehensive training program that must include at least 80 contact hours (one contact hour = 50 minutes).  The training programs must be specific to community association management and must include specific subject areas within the profession.  CAI will be submitting coursework that complies with both the introductory and comprehensive training program requirements.  One of the “courses” that will be submitted to the VA CICB for approval as a comprehensive training program (80 contact hours) is the Professional Management Development Program (PMDP) courses required for the Professional Community Association Manager® (PCAM) designation.  Training program applications will be reviewed by the CICB after April 1, 2010.  As soon as CAI courses are approved, we will notify the membership.

 

IMPORTANT DATES

April 1, 2010 – New regulations go into effect

June 30, 2011 – Provisional license expires. In order to ensure continuous coverage, the provisional licensee should submit the application well before June 30th to allow time to process the new application for issuance on or before July 1, 2011.  The process time is typically two to four weeks, but may be delayed if additional information is needed.

RELATED LINKS

Common Interest Community Board

Common Interest Community Manager Regulations (effective April 1, 2010)

Common Interest Community Manager Board Forms and Applications

FAQs

Question:  How are the permanent regulations different from the emergency regulations?

Answer:  There are a number of differences between the emergency regulations and the permanent regulations.  It is important to read the full permanent regulations to understand your licensure requirements as a community association management firm. 

Question:  Why were there emergency regulations?

Answer: The community association manger licensure program is a professional state regulatory program established by the law.  The state law that passed placed the regulation of managers and associations under the purview of the Common Interest Community Board (CICB) and defined the major requirements of the licensure program.  The administration of this board is housed in the state government under the Virginia Department of Professional and Occupational Regulations (DPOR). The CICB is responsible for developing the rules and regulations to administer the statute.  The process by which the regulations are developed is defined by law and includes due process and vetting through the general public and various departments within the government; including a review by the Governor’s office.  Since this process takes at least 18 months, emergency regulations were developed to bridge the time gap between implementation of the law and approval of final regulations.

Question: Will these permanent regulations ever change?

Answer:  The CICB is already in the process of amending the permanent regulations to add the individual certification provisions that become effective July 1, 2011, in accordance with the statute.  In addition, The Administrative Process Act of the Code of Virginia provides that the CICB perform a periodic review of its regulations to see if any regulations need to be amended or repealed.  As the profession evolves and applicable laws are amended, the CICB can initiate the process to change the regulations as needed.


COMPARISON CHART ILLUSTRATING CHANGES FROM THE EMERGENCY REGULATIONS TO THOSE IN EFFECT APRIL 1, 2010

 

 

Emergency Regulations

Regulations Effective April 1, 2010

18VAC48-50-30 Qualifications (education and credentials). In lieu of an AAMC:

At least one full-time supervisory employee or officer must meet one of the following:

1.       Hold an active PCAM.

2.       Hold an active AMS and have five years experience.

3.       Hold an active CMCA and have five years experience.

At least one full-time supervisory employee or officer with five years experience must complete a comprehensive training program  AND at least 50% of persons who have principal responsibilities for management services must meet one of the following:

1.       Hold an active PCAM.

2.       Hold an active AMS and have two years experience.

3.       Hold an active CMCA and have two years experience.

18VAC48-50-70

Annual Assessment

Applicants must submit documentation of gross receipts for the preceding calendar year.

When the annual assessment due is less than $1,000, applicant/licensee shall submit documentation of gross receipts for the preceding calendar year.  Documentation of gross receipts is not required when an applicant/licenses submits the maximum annual assessment amount of $1,000.  Acceptable documentation may include, but is not limited to, audits, tax returns, or financial statements.

18VAC48-50-190

Prohibited Acts

The list has changed.  Please see the full list for changes.

The list has changed.  Please see the full list for changes.

18VAC48-50-200

Establishment of code of conduct

Establishment of code of conduct didn’t exist in the emergency regulations.

The firm shall establish and distribute to the firm's employees, principals, and agents a written code of conduct to address business practices including the appropriateness of giving and accepting gifts, bonuses, or other remuneration to and from common interest communities or providers of services to common interest communities. In accordance with clause (ii) of § 54.1-2346 E of the Code of Virginia, the code of conduct for officers, directors, and employees shall also address disclosure of relationships with other firms that provide services to common interest communities and that may give rise to a conflict of interest.

18VAC48-50-210

Establishment of internal accounting controls

Establishment of internal accounting controls didn’t exist in the emergency regulations.

The firm shall establish written internal accounting controls to provide adequate checks and balances over the financial activities and to manage the risk of fraud and illegal acts. The internal accounting controls shall be in accordance with generally accepted accounting practices.

Part V Training Programs and Examination

18VA48-50-230 through 18VAC48-50-290

Training programs and examinations didn’t exist in the emergency regulations. 

These regulations define the process for the board to approve courses for training for common interest community manager applicants/licensees. 

 

Note: CAI is submitting an application for the Professional Management Development Program (PMDP) coursework for approval and feels confident that the coursework meets the published requirements.

The Virginia Common Interest Community Board (CICB) is housed in the Department of Professional and Occupational Regulations (DPOR) in the Commonwealth of Virginia. For applications, forms, regulations and information about the CICB, visit their website at: http://www.dpor.virginia.gov/dporweb/cic_main.cfm