Village Square Landlord Owner Rental Rules & Fines
Limited Activation March 1, 2015 with full activation June 14, 2016
Because of the September 2, 2014, Division One of the Court of Appeals of the State of Washington decision in Filmore LLLP v. Unit Owner Association of Centre Pointe Condominium, the Village Square Board of Directors approved the re-implementation of the majority of the Association’s 2011 suspension of the 2006 Rental Housing Amendments to VS@LH CC&Rs, which were approved in 2006 by the required 67% ownership votes, and affirmed in the Filmore decision.
At the beginning of 2015 the Village Square Board issued an implementation notice to our Owners, who rent out their homes or rooms in their Unit, that beginning March 1, 2015 the Association would begin requiring such Owners to come into compliance with the VS@LH CC&Rs previously suspended.  The first phase of this process was to require Landlord Owners to comply with the Auburn City Code 5.22.020 Business License-Fee and if applicable, the updated ACC 5.22.040.C that provides requirements for Communal Housing Rentals (aka student room rentals). A request to provide related documents of the rental process required by our Community’s CC&Rs was also included.
The April 28, 2016 Washington State Supreme Court's decision in Bilanko v. Barclay Court case No. 91247-5, ruled that a Condominium Association’s declaration amendments, adopted in a manner that does not exceed its legal authority and does not appear to be borne out of fraud or other wrongdoing cannot be challenged more than one year after it is recorded. Based on the Bilanko decision, Village Square’s legal counsel has advised the Board of Directors that the currently suspended 2006 rental cap amendments can now be enforced, because our 2006 amendments to the Village Square Declarations were not challenged within the required one year of their 2006 recording. 
Therefore, on June 14, 2016 the Board of Directors voted to approve the activation of the last five (5) suspended sections. These previously suspended sections, of the 2006 amendments, related to the nine (9) Unit Rental Cap and are now active rules of 2006 Amendments to Village Square’s CC&Rs.
Owners are directed to the 2006 Amended CC&Rs for the entire text of these now activated paragraphs listed here. Effective June 14, 2016, failure to comply with each rule will result in individual monthly fines to the Unit Owner for each rule violation, until compliance with the rule is remedied. 
**Please refer to your copy of the Governing Documents for the full text.
3.13.1 Rental Defined and Regulated.  The restrictions on rentals do not apply to Owners who occupy the home, and they may rent rooms subject to the Governing Documents and Auburn City Codes.
3.13.2 Minimum Lease Term Required.  No person shall be permitted to Rent or Lease less than the entire Unit and all leases to be for at least 6 months. This prohibits a Tenant from renting rooms to people not declared on the Owner’s Lease, approved by the Association prior to occupancy.
3.13.3 Minimum Ownership Period Required Before Rental.  New Owners must occupy the Unit for one year to qualify for the Rental Pool, subject to the controlling Governing Documents.
3.13.4 Lease Requirements. This section requires the original signed Lease to bear the written approval by the Association granted prior to the occupancy of the Tenant, or for a renewal of the lease, both to contain language acknowledging the Association’s rights, and the Tenant’s obligation under the Governing Documents.
3.13.5 Lease Approval.  This section requires prior to the Rental of a Unit to a Tenant, and prior to the renewal of any previously approved Lease, Unit Owner shall submit a valid and binding new or renewal lease, executed by both the Owner and proposed Tenant to the Association, and contingent only on the approval of the Association for approval. Association will within seven (7) days of receipt of such request, grant its consent to the Owner if listed subsections through (found on page 5 of the Amendments) permit such approval.
3.13.6 Rental Ceiling Set.  Except as provided in 3.13.12, the maximum number of non-Owner occupied Units in the Condominium at any one time shall not exceed Nine (9) (referred to in the Declaration as the “Rental Ceiling”) NOTE: Exception for ‘related party’ Unit rentals is addressed in 3.13.1.
3.13.7 Effect of Rental Ceiling. Vacated Units may be placed on Waiting List.
3.13.8 Pre-existing Leases. This section requires renewal of Leases to be submitted for Lease Approval pursuant to 3.13.5 and 3.13.9’s restriction of up to 60 days before the expiration of the Lease term then in effect. Also, the assignment or subletting of a Unit by a Tenant or the sale of a Unit by its Owner shall terminate the right to renew a Pre-existing Lease under this section.
3.13.10 Notice of Rental Termination. Owners must advise the Association of the termination or non-renewal of their Lease, and any such termination or non-renewal will result in the end of their opportunity to rent their unit if there is a Rental Waiting List.
3.13.11 Rental Waiting List. (Subject to listed exceptions): If a Rental Waiting List exists, no Lease or Lease renewal shall be approved for a Rental Unit until all Owners who are on the Rental Waiting List have been given the opportunity to apply for Lease Approval.
3.13.12 Hardship Exception. For up to six (6) months at Board’s Discretion.
3.14 Governing Documents to be provided to Tenants.  If Unit Owner fails to provide proof, Association may provide to tenant, at a per page copying cost, as a special assessment against the Unit Owner.
3.15.2 Tenant Screening.  The Unit Owners are required to conduct a tenant screening process, to the extent possible, reasonably in compliance with 3.15.3 for all tenants except Related Parties, or alternately use an independent Tenant Screen Service. If the Owners do not do the tenant screening, a fine to the owners, after notice and opportunity to be heard is permitted. The Owner shall transmit a summary of their screening process, without confidential information included, or the outside screening service’s approval notification of the Tenant, to the Association’s Property Manager along with a copy of the Lease, for retention in the Unit’s File.
3.16.2 Registration of New Occupants.  All Owners must register new Occupants with the Board at the time they move in or within forty-eight (48) hours of meeting the definition specified in 1.1.4. Nothing in this Section shall preclude an Occupant from submitting the registration required by this Paragraph.
19.1 2006 Rules & Regulations for VS@LH VIOLATIONS AND SCHEDULE OF FINES (PAGE 17)
Fines may be imposed by the Board of Directors in accordance with the guidelines below for all violations.
FIRST WRITTEN COMPLAINT A warning letter without a fine.

SECOND WRITTEN A $25.00 fine, payable with the next month’s dues.

THIRD WRITTEN A $100.00 fine, payable with the next month; dues.

Board of Directors shall take action necessary to gain compliance of the resident in violation, including, but not limited to:
  • A letter to the owner and/or resident in question.

  • Assessment of a fine of not less than $25.00, nor

  • more than $250.00, per issue except for Rental Cap Violations where ALL monthly fines will match current market rental rates, with a $1,700.00 monthly fine set as current rate.

  • Filing of a complaint with the Police Department.

  • Filing of action in the courts for injunctive relief.
19.2 Fines will be imposed on the owner of the property regardless of who was the offending party.
19.3 Unpaid fines are considered delinquent after 90 days.  Delinquencies may be subject to a lien on the owner’s property.
19.4 All expenses incurred by the Property Manager, the Association, or the Board of Directors, including all legal and collection costs, will be assessed to the unit owner whose residence is in violation.
19.5 Owners may be fined for parking violations and/or vehicles may be towed and impounded at the owner’s expense by the Board of Directors in accordance with the guidelines outlined by the Parking Committee’s Infraction Plan.  
Village Square Rule 2.6 requires Owners who rent out their units, or rooms in their units, to comply with all Auburn City Code provisions.  The VS@LH will therefore also enforce rental violations of applicable Auburn City Code provisions with monthly fines, after notice and opportunity to be heard, including but not limited to Auburn City Codes (ACC) 5.22.020 and 5.22.040(C), which require a Rental Business License for “each rental housing business operating in the city” or a Communal Residence Rental Housing Business License, as the case may be.  Landlord Owners are also required under VS@LH Rules to provide a copy of their current year’s license to VS@LH’s Property Management.
18.04.794 Renting of rooms.
“Renting of rooms” means the provision of rooms for lodging purposes to not more than two persons in addition to the owner occupied unit, and/or family who lives in the residence. (Ord. 6477 7, 2013; Ord. 6245 3, 2009.)