The Washington Legislature recently passed House Bill 1199, which directly affects the rights of homeowners and condominium unit owners and their respective associations as it relates to the provision of licensed child care services. This bill became effective on May 1, 2023 and amends all existing acts which govern associations, i.e., the Horizontal Property Regimes Act (RCW 64.32); the Condominium Act (RCW 64.34); the Homeowners’ Association (RCW 64.38); and the Washington Uniform Common Interest Ownership Act (RCW 64.90). So, owners in any community association should take notice of the changes this new law has made to the provision of licensed child care services.
House Bill 1199 prevents every association from adopting and enforcing any restriction, condition, covenant, bylaw, rule, regulation, or provision of a governing document, or master deed, which would prohibit, unreasonably restrict, or limit, directly or indirectly, an owner from using their property to provide licensed child care services. Broadly speaking, associations can no longer prohibit owners from offering child care services. However, the bill does allow an association to adopt “reasonable regulations” on a child care service provider.
- Reasonable Regulation
What is considered a “reasonable” regulation? House Bill 1199 offers limited guidance. The bill provides a sole example of “architectural standards” as a reasonable regulation. The bill also requires that regulations be applied to all other properties in the same manner. It appears that the legislators’ intent here is to prevent targeted regulations which would only affect owners who choose to provide child care services. So, if a regulation affects all properties equally, then it will likely be compliant with the language and intent of this bill.
- Provisions of Governing Documents
House Bill 1199 carves out specific provisions that an association may adopt and enforce as part of its governing documents. These are: (1) requiring that the child care service provider be licensed; (2) requiring that the child care provider indemnify and hold harmless the association against all claims, excluding claims related to the common elements; (3) requiring that the child care provider obtain signed waivers of liability from parents which release the association from liability; and (4) requiring that the child care provider obtain insurance.The bill does not require that the association adopt these types of provisions. It is up to the association to determine whether to adopt any or all of these types of provisions.
Any association which willfully violates the provisions of House Bill 1199 is liable to the child care provider for actual damages, and must pay a civil penalty in an amount up to $1,000. Actual damages would include any loss of income that a child care service provider could prove, and any other similar types of costs resulting from the association’s violation. This is potentially a heavy cost to the association, so an association should take corrective action immediately and retain counsel if necessary to review its governing documents. Similarly, owners should be aware of their rights if their association is infringing on the owners’ right to provide licensed child care services.
- Potential Legal Issues
The main issue that will likely arise from the passage of HB 1199 is the interpretation of what is a “reasonable regulation”. As stated above, the bill provides some guidance when it states that a regulation must be applied equally to all properties within the association. However, we certainly expect disputes related to the language and application of such regulations.For instance, a regulation might be adopted which applies to all properties but disproportionately affects child care providers. An example of this would be a regulation regarding visitors or traffic. If an association only allows a certain number of visitors to one’s home or prohibits owners from using their unit in a manner which increases traffic, then these types of regulations would disproportionately affect child care providers despite the regulations being applied to all owners. This could lead to litigation over whether this regulation is reasonable.Another issue that could arise would be related to the interpretation of whether a provision limits “directly or indirectly” the use of their property to provide child care services. A direct limitation would be relatively straight forward. For example, a prohibition of commercial businesses would be a direct limitation which could not be enforced against a child care provider. However, more issues are likely to arise regarding indirect limitations. Examples of indirect limitations are listed above regarding visitor parking and traffic. Another example would be designated quiet hours in a community. A child care provider that has 5+ children may find it difficult to comply with quiet hours during the day, and therefore, this type of restriction may indirectly limit the unit owners’ ability to provide their services. Again, legal issues are likely to arise due to the way these provisions affect the provision of child care services.
House Bill 1199 is a substantial change to the governance of community associations since, given the interpretation issues identified above, it may make some provisions of governing documents unenforceable if they affect owners’ rights to provide child care services. This change may have serious impacts on an association’s ability to prohibit certain activities, as well as subject an association to serious penalties if it does not comply with this bill. At the same time, homeowners and unit owners should be aware of the rights granted in this bill and seek legal counsel if an association is infringing on those rights.